Stocks fall back in early trade

NEW YORK (CNNMoney.com) -- U.S. stocks retreated early Tuesday as investors remained jittery about the nation's economy.

The Dow Jones industrial average eased 0.4 percent. The Nasdaq composite index lost 0.7 percent. The Standard & Poor's 500 index was 0.3 percent lower.

Drugmaker Merck (Charts, Fortune 500), a component of the Dow Jones industrial average, reaffirmed its earlier 2007 earnings per share guidance of $3.08 to $3.14, although that is below the current $3.15 a share consensus forecast of analysts surveyed by Thomson First Call. It also issued its initial guidance for 2008 EPS of between $3.28 to $3.38, which falls short of the First Call estimate of $3.39.

Shares of Merck fell 1.8 percent in premarket trading.

A Senate panel is set to hold a hearing Tuesday about practices in the credit card industry. The chairman of the panel, Sen. Carl Levin, D-Mich., has voiced support for legislation that would limit card issuers' ability to raise customers' interest rates if their credit scores declined. Officials of Discover (Charts), Bank of America (Charts, Fortune 500) and Capital One (Charts, Fortune 500) are due testify at Tuesday's hearing.

Fannie Mae (Charts) could be the next major financial firm to report big losses due to the mortgage meltdown. The company could see writedowns top $5 billion, according to Fortune.

In other corporate news, online auction site eBay (Charts, Fortune 500) announced a partnership with Yahoo (Charts, Fortune 500) to help it return to Japan, a market it exited in 2002.

No. 1 cell phone maker Nokia (Charts) said Tuesday it expects the global market for mobile devices to grow 10 percent in 2008 to more than 1.2 billion. The company said its share will also increase and raised its target for its operating margin. But markets were disappointed in the forecasts and shares of Nokia slipped 3 percent in early trading in Helsinki.

In global trade, major markets in Asia finished the session mixed, with Japanese stocks ending lower. European stocks fell in midday trading.

Oil prices, which just a week ago appeared poised to cross the $100 a barrel threshold for the first time, continued to slide ahead of Wednesday's meeting of OPEC oil ministers and the weekly report on U.S. fuel stockpiles, also due Wednesday, although prices were well above earlier lows. A barrel of light sweet crude was off 33 cents to $88.98.