Dow finishes below 7,000 for first time since '97
The Dow Jones industrial average plummeted below 7,000 at the
opening bell and kept driving lower all day, finishing at 6,763 -- a loss of
nearly 300 points. Each of the 30 stocks in the index lost value for the day.
And the Standard & Poor's 500 stock index,
a much broader measure of the market's health, dipped below the
psychologically important 700 level before closing just above it. It hadn't
traded below 700 since October 1996.
Govt
moves to aid AIG yet again; when will it end
WASHINGTON (AP) -- A new definition of desperate times: Even as
the government threw a stunning new $30 billion lifeline to American
International Group on Monday, the beleaguered insurance giant confirmed it had
lost more than twice that much, $62 billion, in a single three-month period.
The source of trouble for AIG, which has 74 million customers
worldwide and operations in more than 130 countries, is its business insuring
mortgage-backed securities and other debt against default. That business
imploded once the credit crisis struck with force.
The government has now made four separate efforts to save the
company, totaling more than $170 billion.
Spending, manufacturing data point to more pain
WASHINGTON (AP) -- Consumer spending and incomes rose more than
expected at the start of the year, but the gains were seen as fleeting in light
of the recession and the waves of layoffs battering Americans.
Two other reports Monday on manufacturing and construction also
showed little reason for optimism. Analysts said any start to an economic
rebound is at best months away, with the most pessimistic predicting a
sustained recovery won't begin until next year.
The Commerce Department said consumer spending rose 0.6 percent
in January, the first increase after a record six straight monthly declines,
and slightly better than the 0.4 percent rise economists had expected. Incomes
also showed more strength than expected, rising 0.4 percent, although that gain
came primarily from annual pay raises for federal workers and a cost-of-living
increase for the 50 million people receiving Social Security benefits.
Moffett resigning as Freddie Mac CEO
WASHINGTON (AP) -- The top executive of Freddie Mac is quitting
after less than six months on the job as the company continues to hemorrhage
from mortgage losses and plans to ask the government for up to $35 billion in
additional aid.
Freddie Mac said Monday that David Moffett will step down as
chief executive and leave the company's board of directors by March 13.
Moffett, 57, a former vice chairman of US Bancorp, has been CEO since
September, when the government seized control of the mortgage finance company
and its sibling Fannie Mae.
Freddie Mac said its board is working with the Federal Housing
Finance Agency to appoint a successor to Moffett, who indicated in his
resignation letter that he wanted to return to the financial services sector.
Obama names
WASHINGTON (AP) -- President Barack Obama's choice to lead the
Health and Human Services Department has a history of bucking the insurance
industry, which faces the biggest hit under Obama's initial health care reform
plan.
Kansas Gov. Kathleen Sebelius gets her
introduction to the reform debate at a White House summit Obama will convene on
Thursday.
Obama introduced Sebelius on Monday as
his choice to run HHS, including overseeing Medicare and Medicaid, the twin
government health programs for the elderly and the poor. Their spiraling costs
threaten to bankrupt the country.
The 60-year-old, second-term governor has cultivated an image as
someone who stands up to insurers.
HSBC to end
CHICAGO (AP) -- HSBC PLC, Europe's biggest bank, said Monday it
will no longer write new consumer loans in the
The announcement came as London-based HSBC reported a 70 percent
drop in 2008 net profit and said it would raise $17.7 billion in new capital
through a share issue.
The move will close the books on the British bank's ill-fated
decision to buy Illinois-based Household International Inc. six years ago for
$14 billion, which elevated HSBC to the unenviable position of biggest
Deteriorating economy cuts off oil market rally
SIOUX FALLS, S.D. (AP) -- Oil prices plummeted more than 10
percent Monday with little to suggest energy demand will recover in the
deteriorating global economy.
Benchmark crude for April delivery fell $4.61 to settle at $40.15
a barrel on the
Oil prices dipped below $40 per barrel for the first time since a
three-day rally last week. Prices began to fall Friday and the sell-off
continued Monday.
Nortel 4th-quarter loss widens
TORONTO (AP) -- Nortel Networks Corp., a major telecom equipment
company now operating under bankruptcy protection, said its fourth-quarter loss
widened as the weak economy led customers to lower or defer spending.
Toronto-based Nortel on Monday reported a loss of $2.14 billion,
or $4.28 per share, compared with a loss of $844 million, or $1.70 per share, a
year ago.
Nortel filed for creditor protection Jan. 14 in Canada and the
United States, becoming the first major technology company to take that step in
this global downturn.
Dish Network 4Q profit rises, but subscribers fall
UNDATED (AP) -- Dish Network Corp. on Monday said its
fourth-quarter profit rose 24 percent on the back of higher prices and fees,
but the satellite-TV provider lost more than 100,000 subscribers and its
results missed Wall Street forecasts. Its shares fell more than 10 percent.
The nation's second largest satellite TV provider, which aims to
be the low-priced leader among pay-TV providers, said its position was eroded
by discounting at rival cable and phone companies, according to a filing with
the Securities and Exchange Commission.
PNC Financial slashes dividend 85 percent
PITTSBURGH (AP) -- PNC Financial Services Group Inc. said Monday
it is slashing its quarterly dividend 85 percent for savings of about $1
billion annually.
Pittsburgh-based PNC joins a growing list of banks, including
JPMorgan Chase & Co., that have cut their dividends to shore up capital
amid the market and economic turmoil.
PNC, which bought troubled Cleveland bank National City Corp.
late last year, is reducing its dividend to 10 cents per share from 66 cents.
The next dividend is expected to be declared in early April.
By The Associated Press
The Dow fell 299.64 to finish at 6,763.
Benchmark crude for April delivery fell $4.61 to settle at $40.15
a barrel on the
In other Nymex trading, gasoline for
April delivery tumbled 8.63 cents to settle at $1.2862 a gallon, while heating
oil fell 11.6 cents to settle at $1.1512 a gallon. Natural gas for April
delivery fell 4.6 cents to settle at $4.152 per 1,000 cubic feet.