- The Washington Times - Tuesday, April 7, 2009

Wall Street declined Monday, ending four straight days of gains amid concerns about U.S. corporate-earning reports due this week.

The Dow Jones Industrial Average closed at 7,975.85, down 41.74, or 0.5 percent. The Standard & Poor's 500 Index dropped 7.02, or 0.8 percent, to close at 835.48, and the Nasdaq Composite Index closed at 1,606.71, down 15.16, or 0.9 percent. The Russell 2000 Index of smaller companies fell 8.57, or 1.9 percent, to 447.56.

The release of first-quarter earning reports begins Tuesday with Alcoa, a major U.S. aluminum manufacturer and Dow stock.

Investors also are concerned about reportedly stalled talks in IBM Corp.'s $7 billion bid for Sun Microsystems Inc.

Sun shares plunged 23 percent, falling $1.93 to $6.56, a sign that financial markets might not be recovering enough from the recession to support a major merger. IBM stocks fell 66 cents to $101.65 a share.

Investors also were concerned after analyst Mike Mayo of Calyon Securities advised selling bank shares because government efforts to help them might fall short and loan losses will exceed Great Depression levels.

Wells Fargo & Co. and PNC Financial Services Group Inc. were among some of biggest declining bank stocks.

Wells Fargo stock dropped 82 cents to $15.52, and PNC dropped $2.27 to $33.53.

Investors also were concerned about the Treasury Department extending the application deadline to purchase toxic assets. The new April 24 deadline to attract more investors is being interpreted as a sign that the program could be in trouble.

Treasury Secretary Timothy F. Geithner said Sunday that the Obama administration could force the resignation of bank presidents as it did recently with Rick Wagoner, former chief executive officer of General Motors Corp.

The Dow opened Monday on its best four-week run since 1933 and above the 8,000 mark for the first time since early February.

The rally had extended through Friday, despite a Bureau of Labor Statistics report that showed the U.S. economy lost 633,000 jobs in March. The national unemployment rate is at 8.5 percent, its highest levels since 1983, when the country was still a deep recession and unemployment exceeded 10 percent.

Still, investors are optimistic that the U.S. economy is touching bottom and poised to recover after several key economic reports last week, including one by the National Association of Realtors that stated pending home sales rebounded in February from a record low.

They also are upbeat about the G-20 talks last week in London, where world leaders agreed to tougher regulations on financial markets and to spend at least $1.1 trillion to stimulate economies in effort to end the global recession.

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