Stocks stumble on Citigroup woes

NEW YORK (CNNMoney.com) -- Stocks fell sharply at the start of Monday's session as Citigroup's warning that it could suffer billions more in subprime mortgage-related losses worried investors about the health of the broader financial sector.

The Dow Jones industrial index (Charts) lost nearly 0.6 percent in the opening minutes of trade.

The broader S&P 500 index (Charts) slid 0.7 percent, while the tech-fueled Nasdaq (Charts) fell 0.9 percent.

Weighing on stocks was Citigroup's Sunday announcement that CEO and Chairman Charles Prince would step down in the wake the company's mortgage-security losses.

The news provided little comfort to Wall Street, however, as Citi added a warning that it could take writedowns totaling as much as $11 billion in the fourth quarter because of bad mortgage bets.

The news sent Citigroup (Charts, Fortune 500) shares 4.5 percent lower in morning trade, but also weighed on the broader financial sector as Wall Street worried that other banks and brokerages might follow with similar losses.

Shares of investment banks Goldman Sachs (Charts, Fortune 500) and Morgan Stanley (Charts, Fortune 500), as well as retail-focused banks like Bank of America (Charts, Fortune 500), were sharply lower in morning trade.

In other corporate news, the Internet conglomerate IAC (Charts, Fortune 500), which owns a host of firms including the Home Shopping Network, Ticketmaster and search engine Ask.com, announced Monday that it would split into five separately traded public companies.

On the earnings front, Burger King (Charts) reported better-than-expected first quarter earnings and revenue before the opening bell Monday, helped by movie tie-ins and improved sandwich sales.

In commodity trading, oil prices backed away from record highs amid easing tensions between Turkey and Kurdish rebels based in Iraq. Light, sweet crude for December fell $1.91 to $94.02 a barrel on the New York Mercantile Exchange.

Gold prices retreated after climbing to their highest level in nearly 28 years Friday, as COMEX gold for December fell $1.20 to $807.30 an ounce.

Treasury prices fell, lifting the yield on the benchmark 10-year note to 4.31 percent from 4.29 percent late Friday.

The dollar fell versus the euro and retreated against the yen.

In global trade, Asian stocks retreated, reflecting some of the credit concerns raised by the Citigroup news. European stocks were lower in midday trading.