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Stocks have another bad day
Housing and banking worries bring down all of the major indexes.
Associated Press
Published November 20, 2007
NEW YORK - Wall Street resumed its slide Monday as investors absorbed a gloomy outlook for the banking sector as well as bleak news about housing. The major stock market indexes each fell more than 1.5 percent, with the Dow Jones industrial average giving up more than 200 points. Concerns about the banking sector dominated the session. Goldman Sachs Group Inc.'s downgrade of large banks, and its estimate that Citigroup Inc. would have to write down $15-billion over the next two quarters due to its exposure to risky debt, unnerved Wall Street. Other sectors suffered big hits during the session, including homebuilders and airlines. The latest concerns about housing arose after a downcast survey from the National Association of Homebuilders and a lowered forecast from home-improvement retailer Lowe's. The worry on Wall Street is that the housing market is getting so weak it will crimp consumer spending, which accounts for about 70 percent of economic activity. Ahead of the holiday shopping season, any signs that Americans are pulling back could prevent a December rally. The NAHB's November housing forecast remained unchanged at its lowest-ever level even after the October figure was revised to 19 from 18. Economists polled by Thomson/IFR had expected the index would come in at 18. The Dow industrials fell 218.35, or 1.66 percent, to 12,958.44. With Monday's decline, stocks have seen losses in seven of the past eight sessions. Last week, stocks ended higher after a string of volatile sessions. Many traders are wondering whether the major indexes will test the lows for the year that came in August. A big concern for investors was again Citigroup, which said earlier this month it would likely write down $8-billion to $11-billion in the fourth quarter. The bank fell $2, or 5.9 percent, to $32 after the Goldman downgrade to a "sell" rating.
[Last modified November 20, 2007, 01:34:33]
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