Wall Street tumbles as big bank earnings, stronger dollar weigh

08:13, January 21, 2010      

Email | Print | Subscribe | Comments | Forum 

Wall Street tumbled Wednesday, with major averages ending more than 1 percent lower, after a series of bank reports showed the troubled sector was still struggling with consumer-related challenges, such as high home loans and credit losses.

Bank of America reported a wider-than-expected quarterly loss, hurt by still-high loan losses and its repayment of U.S. government bailout aid. According to its report, Bank of America lost 5.2 billion dollars in the fourth quarter. Excluding the one- time, 4-billion-dollar cost to pay back TARP funds and dividends on preferred stock, Bank of America's loss narrowed to 194 million dollars.

Morgan Stanley turned into profit in the last quarter of 2009, however, its 6.85-billion-dollar revenue still fell short of market expectation.

However, Wells Fargo surprised investors by posting a fourth- quarter profit of 394 million dollars.

A jump in the U.S. dollar weighed on the market as global commodity prices came under pressure. The U.S. dollar index surged the most in more than a month, dragging resource-related stocks down.

On the economic front, the Commerce Department said Wednesday that housing starts dropped by 4.0 percent in December, bigger than expected, while building permits jumped 10.9 percent.

In a separate report, the Labor Department said Wednesday, after increasing an unrevised 1.8 percent in November on the back of surging energy prices, the producer price index for finished goods rose a seasonally adjusted 0.2 percent on the month in December, indicating U.S. inflation at the wholesale level was tame.

Investors were also worried that the move by China to restrict lending may cool off Chinese growth, which many analysts believe would upset the Chinese-led global growth.

At Wednesday's close, the Dow Jones fell 122.28, or 1.14 percent, to 10,603.15. Broader indexes also ended lower. The Standard & Poor's 500 index dropped 12.19, or 1.06 percent, to 1, 138.04 and the Nasdaq tumbled 29.15, or 1.26 percent, to 2,291.25.

Source: Xinhua
  • Do you have anything to say?


Special Coverage
Major headlines
Editor's Pick
  • Syrian president meets U.S. Mideast envoy
  • Night scene of Three Gorges Dam
  • View of Sodre concert theater, Uruguay
  • Vancouver Olympic Center Stadium for 2010 Winter Games
  • Zheng Jie of China qualified for next round at Australian Open
  • China's Li Na marches into next round at Australian Open
Most Popular
Hot Forum Dicussion