Stocks turn lower

NEW YORK (CNNMoney.com) -- Stocks turned lower near midday Monday, giving up early, modest gains, as investors sorted through a mostly positive start to the holiday sales period and more problems for the financial and housing sectors.

The Dow Jones industrial average (Charts) lost 0.4 percent around two hours into the session. The S&P 500 (Charts) index lost 0.5 percent and the Nasdaq composite (Charts)lost 0.3 percent.

The early reports from the nation's retailers were positive, with reports from Black Friday and the weekend showing a strong turnout, although no big splurgers. (Full story)

Investors were also keeping an eye on the results from Cyber Monday, the name used to describe the Monday after Black Friday. Cyber Monday sales were expected to break records. (Full story).

But news reports that Citigroup (Charts, Fortune 500) could announce big layoffs as part of a cost-cutting strategy amid the credit market crisis weighed on that stock. Citi shares fell nearly 3 percent.

HSBC Holdings (Charts), Europe's leading bank, said that it will step in to bail out two funds it manages by transferring $45 billion of their assets onto its balance sheet. The short-term debt funds have been hit hard by the credit market tightening.

Citigroup lowered its near-term outlook on the homebuilders, saying it is hard to see when the bottom will be made for the hard-hit industry. Centex (Charts, Fortune 500), Lennar (Charts, Fortune 500) and KB Home (Charts, Fortune 500) were among the names cited in the report.

Among other movers, Dow component Boeing (Charts, Fortune 500) rose more than 2 percent after Wachovia upgraded the jet maker to "outperform" from "market perform," according to Briefing.com.

All financial markets were closed Thursday for Thanksgiving, and closed early on Friday, with many Wall Streeters making a four-day weekend of it. Monday's trading volume was moderate, with participants continuing to drift back after the holiday.

Market breadth was negative. On the New York Stock Exchange, losers beat winners three to two on volume of 410 million shares. On the Nasdaq, decliners beat advancers eight to five on volume of 640 million shares.

Treasury prices rose, lowering the yield on the benchmark 10-year note to 3.98 percent from 4 percent late Friday. Treasury prices and yields move in opposite directions.

In currency trading, the dollar dipped versus the euro, but held above the all-time low hit on Friday. The greenback rose versus the yen.

U.S. light crude oil for January delivery fell $1.26 to $96.92 a barrel on the New York Mercantile Exchange.

COMEX gold for December delivery fell $1.20 to $823.50 an ounce.