Stocks Close Lower On More Credit Worries
Barclays , Britain's third-largest bank, checked in with a $2.7 billion writedown between July and October that was actually less than expected. But while shares initially jumped more than 6 percent after the update, the stock slipped as analysts said BarCap's growth this year and next will be restricted, and that market conditions remain unpredictable.
Dow component General Electric became the latest casualty of the credit turmoil. A $5 billion short-term bond fund run by GE's asset management unit is offering investors an option to redeem their holdings at 96 cents on the dollar.
In a Nov. 8 e-mail to institutional investors, GE Asset Management said "extreme conditions in the credit markets" are forcing the fund to sell securities at a loss.
NovaStar Financial shares sank by roughly half after the company, which has halted subprime mortgage lending, posted a big quarterly loss and said bankruptcy is possible. Shares are expected to be delisted on the New York Stock Exchange in the next several weeks.
In earnings news, Applied Materials , the largest supplier of tools for making microchips, gave a profit forecast far below Wall Street expectations, stirring concerns about holiday-season sales and sending its shares briefly down, before rallying on the belief that company's overall fundamentals were still strong.
Tyco International reported sharply lower quarterly net profit, but earnings and sales from continuing businesses topped Wall Street forecasts, while Upscale home furnishings retailer Williams-Sonoma posted lower quarterly profit, but beat analysts' expectations.
Elsewhere, Ralcorp Holdings saw a big gain after it said it would acquire Kraft Foods' Post cereals business in an all-stock dealvalued at about $1.65 billion.