Investors are girding for more heavy falls on Wall Street at the open today as fresh concerns of shady deals swept over financial giants like Merrill Lynch and left the market awash in more gloom after days of declines.
US congressional investigators probing possible insider trading of ImClone Systems by US lifestyle guru Martha Stewart demanded more records from Merrill Lynch, whose brokers executed trades before a key regulatory setback for the drug company.
That dealt another blow to the financial sector after two of largest US banking companies helped slam the market to fresh five-year lows yesterday.
Investors dumped shares of Citigroup and JP Morgan Chase as the two giants face mounting criticism for deals involving failed energy trader Enron.
JP Morgan before the open said it would hold a conference call early in the day to discuss issues related to its sinking stock, which has fallen on worries it may have marketed the type of loans used by Enron to other firms.
Equity futures pointed to a grim open a day after stocks sank to new five-year lows in heavy, volatile trading. September futures for the Standard & Poor's 500 fell 9 points to 787.80.
Dow Jones Industrial futures tumbled 80 points to 7,618, while Nasdaq 100 futures sank 15.50 points to 886.50. "We don't have that full capitulation," one dealer said.
Many analysts are calling the market deeply oversold, but investors refuse to jump into a market rife with corporate scandals and dim earnings outlooks.