US stocks head for lower open; bank woes continue

[June 20, 2008]  NEW YORK (AP) -- U.S. stocks headed for a lower open Friday as investors digested a slew of bad news about the beleaguered financial services industry and awaited this weekend's meeting in Saudi Arabia on oil production.

The gathering of oil producers and consumer nations might end up being a finger-pointing session about the high cost of crude, according to analysts. But it may result in possible solutions to the problem, which could help relieve the market's worry about soaring energy prices further dampening consumer spending.

Anxiety over the financial sector remains. Late Thursday, Moody's Investors Service downgraded on the two biggest bond insurers -- MBIA Inc. and Ambac Financial Group Inc. -- from "AAA" amid ongoing concerns about their financial health. The move was widely expected -- the ratings agency had already warned of a possible downgrade, and followed similar actions by rival agencies Standard & Poor's and Fitch Ratings -- but it underscored the troubles that the nation's money centers face.

Although a sharp drop in oil prices Thursday allowed for a modest stock advance, the Dow Jones industrial average is still down about 230 points for the week after getting hit by re-emerging worries about the economy and bad debt at banks. After Citigroup Inc.'s chief financial officer warned Thursday about more significant write-downs at the U.S. bank with the most assets, Washington Mutual Inc. announced it was cutting 1,200 jobs nationwide, mostly in California and Florida.

Dow futures on Friday slipped 19, or 0.16 percent, to 12,025. Standard & Poor's 500 index futures fell 4.10, or 0.31 percent, to 1,337.50. Nasdaq 100 index futures fell 4.75, or 0.24 percent, to 1,985.75.

Light, sweet crude oil futures rose 50 cents to $132.43 a barrel in premarket electronic trading on the New York Mercantile Exchange, after dropping about $5 a barrel on Thursday.

Bond prices rose ahead of the market's open. The yield on the benchmark 10-year Treasury note, which moves opposite its price, dipped to 4.18 percent from 4.21 percent late Thursday.

The dollar fell against other major currencies, while gold prices also declined.

Overseas, Japan's Nikkei stock average dropped 1.33 percent. In midday trading, Britain's FTSE 100 was close to flat, Germany's DAX index declined 0.08 percent, and France's CAC-40 rose 0.15 percent.

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On the Net:

New York Stock Exchange: http://www.nyse.com/

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[Associated Press; By MADLEN READ]

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