Wall Street tumbled Tuesday, led by financials and energy stocks, amid dismal profit outlook and decline in commodity prices.
Financial are among worst performers, after Goldman Sachs reduced its rating on the life-insurance industry to "cautious" from "neutral" and told clients to sell shares of Prudential Financial Inc., the second biggest U.S. life insurer, which also weighed on stocks of life-insurers.
The Federal Reserve granted on Monday a request by American Express to become a bank holding company, giving it access to low-cost financing from the Fed. American Express dropped over 5 percent in morning trading.
Exxon Mobil Corp. and Chevron send energy stocks sharply lower as oil dipped below 59 U.S. dollars a barrel amid speculation the International Energy Agency will lower its 2009 demand forecast for oil.
General Motors traded below 3 U.S. dollars per share for the first time since April 1943, as investors worried that the largest U.S. automaker is close to bankruptcy.
Moreover, Toll Brothers Inc., the largest U.S. luxury homebuilder, said fourth-quarter revenue plunged 41 percent amid the housing and credit crisis.
Starbucks Corp., the world's biggest chain of coffee shops, fell 3.7 percent after the company reported the fourth-quarter profit plunged 97 percent.
The Dow Jones fell 269.77 to 8,600.77. Broader indexes also tumbled. The Standard & Poor's 500 index slipped 28.97 to 890.24 and the Nasdaq fell 48.74 to 1,568.00.
Source: Xinhua
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