Stocks Slide as Crude Falls, Banks Drag

Stocks opened lower Friday as crude oil dropped below $71 a barrel and banks dragged after Bank of America lowered its outlook for the sector.

Export prices rose 0.6 percent in May, while import prices jumped 1.4 percent, mostly due to a surge in gasoline prices.

Still to come: the Reuters/University of Michigan Surveys of Consumer sentiment is due for release at 9:55 am New York time. Economists in a Reuters survey expect a reading of 69.5 compared with 68.7 in the final May report.

Crude oil fell more than $1 a barrel, trading below $71 a barrel, after topping $73 in the prior session.

Banks were a drag after Bank of America/Merrill Lynch slashed its second-quarter earnings estimates Goldman Sachs , Morgan Stanley and JPMorgan Chase .

In other news out of the sector, big financials like JPMorgan, Morgan Stanley and American Express will start repaying government bailout funds next Wednesday, the Wall Street Journal reported, citing people familiar with the matter.

And BlackRock became the world's biggest asset manager after Barclays confirmed Friday it would sell its BGI investment arm to the company for $13.5 billion.

AIG late Thursday said it promised to use any funds won at its high-profile trial, with a company controlled by former CEO Maurice Greenberg, to repay U.S. taxpayers.

Pharmaceutical stocks could get a boost Friday after the World Health Organization declared the first flu pandemic in 41 years but stressed that swine flu (the H1N1 virus) has shown no signs of turning more lethal.

Media stocks could move higher as the U.S. television industry switches to digital TV.

In bonds, after a successful 30-year U.S. bond auction on Thursday, Federal Reserve officials are unlikely to considerably increase purchases of U.S. Treasurys and mortgage-backed securities when they meet in late June, the Wall Street Journal reported on its Web site.

Group of Eight (G8) finance ministers will meet in Italy over the weekend.

Better-than-expected Chinese factory output in May and an upwards revision for Japan's industrial output in April gave Asian stocks a boost, while European stocks drifted on Friday.

National Economic Council Director Larry Summers speaks at 11:15 am at the Council on Foreign Relation's annual conference for national members. In Washington, auto industry executives head to the Hill for a House Energy hearing on dealership closures and industry restructuring.