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US stocks open lower on financial sector worries

US stocks open lower on financial sector worries

Stocks fell in early trading Thursday as oil prices rose again and investors grew more anxious about the financial sector, particularly mortgage financiers Fannie Mae and Freddie Mac and investment bank Lehman Brothers Holdings Inc.
Oil prices rose as investors grew nervous that rising tensions with Russia could disrupt energy shipments from the world's second-largest oil producer. Wall Street is worried that the rise in oil will hasten increases in inflation and put more pressure on already struggling consumers, whose spending is crucial to the well-being of the economy.
Investors also grappled with fresh worries about the financial sector. A slew of analysts have been downgrading banks and brokerages over the past few weeks, and late Wednesday, Citigroup analyst Prashant Bhatia lowered his third-quarter estimates for the investment banks Lehman Brothers Holdings Inc., Goldman Sachs Group Inc. and Morgan Stanley. He predicted Lehman will write down its assets by $2.9 billion, that Goldman Sachs will write down $1.8 billion, and that Morgan Stanley will write down $1.7 billion.
In the first hour of trading, the Dow Jones industrial average fell 88.10, or 0.77 percent, to 11,329.33. The Dow managed a moderate gain on Wednesday.
Broader stock indicators also declined Thursday. The Standard & Poor's 500 index fell 8.48, or 0.67 percent, to 1,266.06, and the Nasdaq composite index fell 20.18, or 0.84 percent, to 2,368.90.
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