YAHOO [BRIEFING.COM] A sharp sell-off in the stock market Monday snapped a five-session winning streak as inventors digested a weak manufacturing survey, the possibility that the Federal Reserve may buy longer-term Treasuries, word that the U.S. economy officially entered recession in December 2007 and concerns regarding financials.

The S&P 500 dropped 8.9%, settling near its lows following a late session surge surge in selling interest. Volume was slightly above the year-to-date average. The decline was broad-based, with 498 of the components within the S&P 500 posting a decline.

The financial sector (-17.0%) got hit the hardest. Oppenheimer analyst Meredith Whitney said the U.S. credit card industry may cut credit lines by well over $2 trillion, or 45%, over the next 18 months, citing risk aversion, funding challenges and regulatory and accounting changes. Whitney's opinion is well respected after she correctly predicted much of the turmoil on Wall Street.

Weakness in commodities (-3.6%), with oil dropping 9.5%, weighed on the energy (-10.3%) and material sectors (-9.8%).

In economic news, Federal Reserve Chairman Ben Bernanke said the U.S. economy remains under stress despite the efforts of the Fed and other Policy makers. To help alleviate the stress, he laid out possible further policy actions, including lowering the fed funds rate, purchasing longer-term Treasuries or agency securities on the open market.

The latter comment, along with a flight-to-safety bid, sparked a rally in Treasuries, with yields of both the 10-year note and 30-year bond dropping too record lows. The 10-year note rose 48 ticks to yield only 2.75% and the 30-year bond rose more than four points to yield 3.23%.

The November ISM Index, a national manufacturing survey, declined to 36.2 from the October reading of 38.9. This was worse than the consensus estimate of 37.0 and, represents the most contraction in U.S. manufacturing since 1982. The survey shows continued signs of dropping prices, with the ISM Prices Paid Index declining to 25.5 from October's reading of 37.0. The industrials sector dropped 8.5%.

The National Bureau of Economic Research announced that December 2007 marks the end of a 73 month expansion in the U.S. economy and the beginning of a recession. Assuming the U.S. is still in a recession, the duration of decline the peak to trough decline will surpass the recessions of 2001 (8 months) and 1990/1991 (8 months), marking the longest recession since 1981/1982 (16 months).

Black Friday sales were better-than-feared.  Depending on the research firm, sales were up between 2% and 7% year-over-year. However, there are concerns that the sales came at the expense of steep discounts and buying has since tapered off. Retailer stocks dropped 9.3%.

In the end, the S&P 500's decline of 80 points erased nearly all of last week's 96 point gain. The index is up 10.2% from its multi-year low reached on Nov. 21, and down 44.4% this year.DJ30 -679.95 NASDAQ -137.50 NQ100 -8.0% R2K -11.9% SP400 -10.9% SP500 -80.03 NASDAQ Dec/Adv/Vol 2353/416/1.95 bln NYSE Dec/Adv/Vol 2809/356/1.63 bln