Stocks fall for second day

U.S. markets head lower as credit fears continue to alarm investors; upcoming consumer confidence report looms.

August 28 2007: 9:50 AM EDT

NEW YORK (CNNMoney.com) -- Stocks fell for the second straight session early Tuesday as renewed credit crunch fears again kept investors jittery on Wall Street.

The Dow industrials, the broader S&P 500 and the tech-fueled Nasdaq composite all posted moderate declines minutes after the opening bell.

A closely watched real estate report showed that home prices in 20 U.S. cities fell 3.5 percent from a year earlier.

In corporate news, Home Depot officially agreed to cut the price of its supply division sale to buyout firms by $1.8 billion, a sign that the problems shaking credit markets are spreading into the buyout market - a possible negative for stocks.

Large banks Barclays and State Street were reported to have substantial holdings exposed to risky debt, although Barclays played down the concerns.

Investors are also looking ahead to the August reading on consumer confidence, due at 10 a.m. ET. Economists surveyed by Briefing.com are forecasting a sharp decline from July's six-year high.

In addition, minutes from the Aug. 7 Federal Reserve meeting are also expected Tuesday afternoon. After holding their target for a key overnight interest rate steady at that meeting, the central bank unexpectedly cut the discount rate it uses to lend directly to banks just 10 days later, on Aug. 17.

The Fed's actions - and the thinking of policymakers' at the Aug. 7 meeting - are being closely watched given the credit crisis.

Companies in the news include Home Depot (Charts, Fortune 500), Medco Health Solutions Inc. (Charts, Fortune 500), PolyMedica Corp. (Charts), Marsh & McLennan (Charts, Fortune 500), and Berkshire Hathaway Inc. (Charts, Fortune 500)

Oil prices sank about 18 cents to $71.79 a barrel on electronic trading.

More on markets.

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(Correction: An earlier version of this story said the Fed raised the discount rate on Aug. 17. CNNMoney regrets the error.) Top of page
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Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer LIBOR Warning: Neither BBA Enterprises Limited, nor the BBA LIBOR Contributor Banks, nor Reuters, can be held liable for any irregularity or inaccuracy of BBA LIBOR. Disclaimer. Morningstar: © 2012 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2012 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2012. All rights reserved. Most stock quote data provided by BATS.
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