Stocks Finish Lower, Ending Four-Day Rally

Updated from 4:14 p.m. EDT

Stocks in New York pulled back in the final hour of trading Monday, and were unable to sustain a fifth straight day of gains.

Among the headlines, President Obama fleshed out a $15 billion plan to help small businesses and addressed the outrage regarding AIG bonuses.

The Dow Jones Industrial Average lost 7.01 points, or 0.1%, to 7216.97, while the S&P 500 was down 2.66 points, or 0.4%, at 753.89. The Nasdaq gave up 27.48, or 1.9%, to 1404.02

General Motors ( GM) retracted 7.4%, leading the Dow's decliners. But Bank of America ( BAC)and Citigroup ( C) held onto gains of 7.3% and 30.9%, respectively.

Helping the market start the day higher, Fed Chief Ben Bernanke reiterated his forecast Sunday night on "60 minutes" that the recession would probably end this year if efforts to stabilize and reinvigorate shaky banks are successful, although that's a difficult task.

As to news of the day, one of the poster children for federal bailouts, AIG ( AIG), which reported the largest corporate loss in history, said it will pay hundreds of millions in bonus payments for executives and employees. The beneficiaries include those at a business unit that was responsible for losing $40.5 billion last year and positioned the company to have to take $173.3 billion in federal aid.

"This is a financial company that finds itself in distress due to recklessness and greed," said President Barack Obama. "It's hard to understand how derivative traders warranted any bonus. How do they justify this?" he asked.

In the last six months, AIG has received substantial sums of bailout money from the government, said Obama, adding that he's asked Treasury Secretary Tim Geithner "to pursue every single legal avenue to block these bonuses."


Should AIG be allowed to pay its planned bonuses?

Yes
No

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