Thursday's mid-afternoon trade: Wall Street falls on Citi, Bank of America anxiety

US stocks fell on Thursday as a plea for government cash by Bank of America and fears about Citigroup's fate as it restructures heightened concerns of greater impact from the credit crisis. Shares of Bank of America, the largest US bank, were the top drag on the Dow, down 20.5 percent at $8.11. Citigroup plunged more than 17 percent to $3.75 a day before the bank is expected to report quarterly results and a new strategic direction.
Bank of America is asking for billions of dollars of government aid after credit losses at Merrill Lynch & Co, which it is acquiring, were higher than expected, a person familiar with the matter said. "It definitely caught the market by surprise that at this late hour we're hearing once again about issues related to toxic securities," said Stephen Massocca, managing director at Wedbush Morgan in San Francisco.
The Dow Jones industrial average fell 165.27 points, or 2.02 percent, to 8,034.87. The Standard & Poor's 500 Index gave up 20.78 points, or 2.47 percent, at 821.84. The Nasdaq Composite Index was down 22.99 points, or 1.54 percent, at 1,466.65. It was the seventh straight day of declines for the Dow, which briefly dropped below the 8,000 level for the first time since the market's November 21 bear market low.