The U.S. stock market resumed its January swoon after Citigroup Inc. reported a record loss, retail sales unexpectedly dropped and falling oil prices dragged down energy shares.
Citigroup, the largest U.S. bank, declined the most since November in New York Stock Exchange trading after cutting its dividend by 41 percent because of rising home-loan defaults. Exxon Mobil Corp., the biggest U.S. oil company, posted its steepest drop in seven weeks. Wal-Mart Stores Inc., the world’s largest retailer, tumbled on a report showing sales at chain stores slumped in December for the first time since June.
The Dow Jones Industrial Average, which had its biggest gain of the year yesterday, slid 220.54, or 1.7 percent, to 12,557.61 at 12:47 p.m. in New York. The Standard & Poor’s 500 Index lost 29.62, or 2.1 percent, to 1,386.63, bringing its 2008 decline to 5.6 percent. The Nasdaq Composite Index decreased 54.32, or 2.2 percent, to 2,423.98. Almost 10 stocks retreated for every one that rose on the NYSE.
“Citigroup kept saying forever that they weren’t going to have to cut the dividend,” said Bill Knapp, who helps manage $252 billion at MainStay Investments in New York. “With the writedown today, what’s to come? We probably need to see the first quarter stuff pass before people are really going to believe what they hear.” [MORE]
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