Financials Lead Stocks Down 49.05

The financial sector, facing credit-card write-downs and increasing shareholder dilution, led the broader market lower. The Dow Jones Industrial Average finished down 49.05 points, or 0.5%, at 10452.00. Bank of America was its weakest component, off 2.8% after writing off 13% of credit-card debt, the highest rate of any major card issuer. J.P. Morgan Chase declined 2.2% after it wrote off 8.8% of credit-card loans in November. The reports of hefty write-downs came as investors are trying to determine how the current holiday-shopping season will shape up. The season "will probably be OK compared to a year ago, but remember, you're making a comparison to a very weak [year-ago] period," said Kathleen Stephansen, managing director at Aladdin Capital Holdings. "Consumers are still in a mode where they're trying to repair their household balance sheets, which means they'll tend to avoid big purchases for some time to come." Traders grumbled about the increasing supply of shares in many Wall Street firms as they attempt to raise cash to repay government bailout money. Citigroup tumbled 3.8% the day before a $17 billion offering is expected to be priced by underwriters. Energy stocks were a bright spot, helped by a rally in crude oil that snapped a nine-day losing streak. Oil futures rose 1.7%, which traders said was triggered by the recent dip in prices below $70 a barrel. The S&P 500 fell 0.6% to 1107.93, led by a 1.7% decline in its financial sector. All its other categories also traded lower, except energy, which rose 0.1%. The producer-price index report showed a bigger-than-expected rise in U.S. wholesale prices, sparking some concern about inflation. Treasury prices fell, sending yields higher for the fifth consecutive day. As the dollar rose against the euro and the yen, the U.S. Dollar Index climbed 0.7%.