Stocks hit 2d bad day in a row, fall 106 points

NEW YORK - Wall Street ended a depressing week with another big loss yesterday, with the Dow Jones industrials falling more than 100 points amid escalating worries about high oil prices and fallout from the credit crisis. The major indexes are all down more than 3 percent for the week.

The Dow has fallen nearly 460 points in the last two sessions and reached its lowest point since September 2006.

Investors contended yesterday with troubling news about the financial sector. Moody's Investors Service said it was reviewing investment bank Morgan Stanley for a possible downgrade. There were also more reports that Merrill Lynch & Co. might have to write off nearly $6 billion of risky mortgage-backed debt.

The market watched oil's continued rise - the price of crude rose to a new record of $142.99 a barrel on the New York Mercantile Exchange.

The Dow fell 106.91, or 0.93 percent, to 11,346.51, following Thursday's 358-point skid. The blue-chip index is down 19.9 percent from its record high close of 14,164.53 in October, and is on the verge of the 20 percent pullback that is considered the threshold for a bear market.

The Standard & Poor's 500 index fell 4.77, or 0.37 percent, to 1,278.38. The S&P, the index most closely watched by market professionals, is down 18.3 percent from its October high. The Nasdaq composite index fell 5.74, or 0.25 percent, to 2,315.63.

For the week, the Dow gave up 4.19 percent, the S&P shed 3 percent and the Nasdaq fell 3.76 percent. With one trading day left in the second quarter, the Dow is down 7.47 percent, the S&P 500 is off 3.35 percent, and the Nasdaq is up 1.60 percent.

Year-to-date statistics show how badly the market has suffered from the credit crisis and the effect of soaring oil: The Dow is down 14.46 percent, the S&P 500 is down 12.94 percent and the Nasdaq is down 12.69 percent.

In other economic news, the University of Michigan's June index of consumer sentiment came in at 56.4, a bit lower than its reading in May and slightly below the average analyst estimate.

"The problem is that there's not one, single worry," said Hugh Johnson, chairman and chief investment officer of Johnson Illington Advisors. He pointed to high gas prices, still-tight credit market conditions, and the contracting housing market. "If you're looking for problems that face investors, that face the U.S. economy, they're everywhere."

Also yesterday, a Lehman Brothers analyst raised his prediction of Merrill Lynch's asset markdowns in the second quarter. His write-down estimate rose to $5.4 billion from $3 billion. On Thursday, a Goldman Sachs analyst forecast a $4.2 billion write-down at Merrill and a nearly $9 billion write-down at Citigroup Inc.

Merrill shares fell 35 cents to $32.70, and Citigroup shares fell 42 cents, or 2.4 percent, to $17.25.

Morgan Stanley dropped 12 cents to $36.71 after Moody's said the investment bank's "financial performance and risk management has been inconsistent" since credit markets began faltering last year.

The Russell 2000 index of smaller companies fell 0.28, or 0.04 percent, to 698.14.