U.S. stocks on Tuesday thudded lower after two days of gains as the financial sector was hit by more evidence of ongoing credit-related trouble, with the damage partially offset by crude's retreat to $113 a barrel.
"How this story plays out really depends on whether the weakness in financials bleeds out to other sectors in the economy," said Linda Duessel, equity strategist at Federated Investors.
Twenty-three of the Dow Jones Industrial Average's (DJI) 30 components chalked up losses, with the declines led by financials, including J.P. Morgan Chase & Co. (JPM), off 9.5%, and American International Group Inc. (AIG), down 6.6%. The blue-chip index shed 139.88 points to close at 11,642.47.
General Motors Corp. (GM) fronted blue-chip gains, with shares of the automaker gaining 3.2%.
The S&P 500 (SPX) declined 15.72 points to 1,289.59, with financials also fronting declines among the index's 10 industry groups, off 4.5%, followed by utilities, down 2.1%.
Materials and consumer staples were the only gaining sectors on the S&P, with materials up 0.2% and consumer stables edging fractionally higher.
After short-lived forays in positive turf, the Nasdaq Composite (RIXF) lapsed into the red, falling 9.34 points to finish at 2,430.61.
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