Stocks driven lower
Concerns about GM, Chrysler and the banks drag on Wall Street in the early going.
NEW YORK (CNNMoney.com) -- Stocks tumbled Monday morning as worries about the auto industry and banking system gave investors a reason to keep retreating after the recent rally.
The Dow Jones industrial average (INDU) fell 202 points, or 2.6% in the early going. The S&P 500 (SPX) index lost 21 points, or 2.6%. The Nasdaq composite (COMP) lost 39 points, or 2.6%.
Stocks tumbled after the White House said automakers General Motors and Chrysler would have to do more in order to receive further aid, and forced out GM's chairman Rick Wagoner.
Financial stocks were under pressure after Treasury Secretary Tim Geithner said some banks will need more help.
World markets tumbled, with auto shares leading declines. Japan's Nikkei slumped nearly 5% and major exchanges in London, Paris and Germany were down as much as 3% in afternoon trading.
"We were starting to see some light at the end of the tunnel, but it's beginning to look oddly like a train," said Art Hogan, chief market strategist at Jefferies & Co., referring to the recent Wall Street rally that now faces a "trifecta of negative catalysts."
Hogan said that Geithner's statement about banks in need of more stimulus is particularly alarming in the face of the "awful" auto industry, which had not been weighing on investor sentiment in recent weeks.
More bad news could be ahead, said Hogan. With the first quarter drawing to a close, he said, "This will be the time when companies come out and announce that they missed expectations. It's a scheduled time for bad news."
Autos: The Obama administration gave General Motors and Chrysler LLC failing grades for their turnaround efforts late Sunday and forced out GM CEO Rick Wagoner.
The White House said it would provide the ailing automakers operating funds for several weeks, but it is holding out the threat of a "structured bankruptcy" for the firms if they do not revamp their restructuring plans.
GM will get 60 days and Chrysler 30 days in which to make a final push toward proving they can run viable businesses.
President Obama is expected later Monday morning to make a formal announcement about his overhaul of the companies, which have already been given $17.4 billion.
GM (GM, Fortune 500) stock dropped 23% in morning trading.
Banks: Treasury Secretary Geithner said Sunday the government has about $135 billion left for bank bailouts and that some banks would need "large amounts of assistance" to survive the credit crisis. (Full story)
Bank stocks were lower in early trading. Citigroup (C, Fortune 500) fell about 11%, Bank of America (BAC, Fortune 500) lost 10%, JPMorgan Chase (JPM, Fortune 500) lost 6% and Wells Fargo (WFC, Fortune 500) lost 5%.
Oil and money: Crude for May delivery fell $2.28 to $50.10 a barrel in electronic trading. The dollar fell against the yen and was slightly higher versus the euro and the British pound. 
