Wall Street pared early gains boosted by the U.S. government's plan to aid mortgage financiers Fannie Mae and Freddie Mac Monday morning and traded lower led by financial shares.
The Federal Reserve and the U.S. Treasury Department said Sunday they would aid Fannie Mae and Freddie Mac, the two largest providers of financing for U.S. home mortgages, if needed in order to ease some worries of further turmoil in the credit markets. The release of the plan help stocks soar in early trading Monday.
However, the U.S. government's seizure of IndyMac Bancorp Inc. and prediction of more credit losses overshadowed the market soon.
The U.S. government took over IndyMac Bancorp Friday. IndyMac became the second largest financial institution to close in U.S. history.
Zoins Bancorporation tumbled to an 11-year low, after Goldman Sachs said the regional banks may cut their dividends and thus downgraded its shares to "sell."
The Dow Jones fell 6.10 to 11,094.44. Broader indexes also turned lower. The Standard & Poor's 500 index dipped 2.73 to 1,236.76; and the Nasdaq fell 12.18 to 2,226.90.
Source:Xinhua
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