Updated from 1:19 p.m. EDTSliding names like Merrill Lynch ( MER) were the norm for financial stocks Friday as the sector generally underperformed the major indices. New York-based Merrill gave up 0.7% after saying that "credit market conditions have continued to remain challenging in the third quarter" and that it "has made requisite fair value valuation adjustments" regarding certain exposures -- the risk of which, as it had stated in its most recent quarterly filing, "could adversely impact ... results of operations." These adjustments "are reflected in our third quarter to date results," the broker said today. Shares closed off 49 cents to $74.65. Merrill also cited broad-market concerns in cutting American Express ( AXP) to neutral from buy Friday. The credit-card company could suffer, said Merrill, from the consumer-spending and employment downturns that might result from housing and financial-market woes. The New York-based company lost 2.7% to close at $58.94. In earnings, personal auto insurer First Acceptance ( FAC) plummeted 34.8% to $5.05 after swinging to a fiscal fourth-quarter loss of $23.9 million, or 50 cents a share, from a 30-cent per-share profit last year. Fellow insurer Progressive ( PGR) said its August income plunged 37.3% year over year to $76.9 million, or 11 cents a share, as the value of premiums written and earned slipped from last year. Shares lost 2%.