Saguaro
10-24-2007, 08:43 AM
NEW YORK - Stocks fell in early trading Wednesday as Wall Street grew more cautious after Merrill Lynch & Co.'s earnings revealed severe credit-related losses.
The investment bank said it wrote down $7.9 billion in fixed-income instruments called collateralized debt obligations and from defaulting subprime mortgages — more than the $5 billion writedown it estimated earlier this month. The result was a net loss for the quarter of $2.3 billion, after total revenue plummeted 94 percent.
The worse-than-anticipated loss signaled to investors that the financial sector may be in a more dire situation than feared because of the credit squeeze that was triggered in part by spikes in mortgage defaults. Meanwhile, the National Association of Realtors' 10 a.m. EDT report on existing home sales was projected to show a drop in September for the seventh straight month.
The technology sector appeared to be losing momentum from earlier in the week. Amazon.Inc. said late Tuesday its quarterly profit more than quadrupled, but it only beat per-share estimates by a penny. Investors didn't see enough reason to bring the Internet retailer's shares, already at their highest level since 1999, even higher.
The Dow Jones industrial average fell 52.76, or 0.39 percent, to 13,623.47.
Broader stock indicators also dropped. The Standard & Poor's 500 index fell 8.04, or 0.53 percent, to 1,511.55, while the Nasdaq composite index lost 28.48, or 1.02 percent, to 2,770.78.
http://news.yahoo.com/s/ap/20071024/ap_on_bi_st_ma_re/wall_street;_ylt=AsZD1QWAVTHace_9jY5a5dBv24cA
The investment bank said it wrote down $7.9 billion in fixed-income instruments called collateralized debt obligations and from defaulting subprime mortgages — more than the $5 billion writedown it estimated earlier this month. The result was a net loss for the quarter of $2.3 billion, after total revenue plummeted 94 percent.
The worse-than-anticipated loss signaled to investors that the financial sector may be in a more dire situation than feared because of the credit squeeze that was triggered in part by spikes in mortgage defaults. Meanwhile, the National Association of Realtors' 10 a.m. EDT report on existing home sales was projected to show a drop in September for the seventh straight month.
The technology sector appeared to be losing momentum from earlier in the week. Amazon.Inc. said late Tuesday its quarterly profit more than quadrupled, but it only beat per-share estimates by a penny. Investors didn't see enough reason to bring the Internet retailer's shares, already at their highest level since 1999, even higher.
The Dow Jones industrial average fell 52.76, or 0.39 percent, to 13,623.47.
Broader stock indicators also dropped. The Standard & Poor's 500 index fell 8.04, or 0.53 percent, to 1,511.55, while the Nasdaq composite index lost 28.48, or 1.02 percent, to 2,770.78.
http://news.yahoo.com/s/ap/20071024/ap_on_bi_st_ma_re/wall_street;_ylt=AsZD1QWAVTHace_9jY5a5dBv24cA