Even with investor focus on a buoyant U.S. dollar running rough shod over commodity prices on Monday, financial and technology stocks are still whipping up market concerns. Credit Suisse Group recommended "modestly" trimming holdings of technology companies on concerns that global growth will slow. "While we still believe there is a good valuation case, it is less unambiguous," writes analyst Andrew Garthwaite. On the financial ledger, Citigroup downgraded E-Trade Financial to "sell" from "hold" after the online brokerage predicted it no longer expects "profit outlook levels" to be achieved, with writedowns likely to exceed previous expectations. Lehman Brothers also downgraded Fannie Mae and Freddie Mac, the two biggest sources of U.S. home loans, to "equal weight" from "overweight," citing "significant uncertainty in the credit and earnings outlook." And published reports suggest Citigroup delayed for more than a week its mind-numbing disclosure of gargantuan fourth-quarter writedowns, which could open the big bank to shareholder lawsuits. Citigroup denied it had done anything wrong. The next firm sinking in rising levels of subprime writedowns could be HSBC, one of the largest lenders in the sector and which was one of the first banks to report problems with rising delinquencies and defaults on the loans a year ago, according to The Wall Street Journal. But the capsizing market ship appears to be righting itself on word that the top three U.S. banks agreed over the weekend on the structure of a backup fund of at least $75-billion (U.S.) to stabilize credit markets. Indeed, the early view of stock-index futures suggests investors may use the "superfund" accord to prowl for bargains on Monday after last week's mauling, including the Nasdaq's biggest weekly fall in six years. "Although there's some weakness in Asian markets, I don't think we'll get much follow-through," Arthur Hogan, chief market analyst at Jefferies & Co., told Reuters. "Coming into this week, I think we're going to try to find a balance, and I would be surprised if we didn't see bargain-hunters coming in, especially in the financials." Two hours ahead of the opening bell, Dow Jones industrials futures have edged up 22 points, S&P 500 futures are 2.5 points higher and Nasdaq 100 futures have gained 4.75 points.
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