US STOCKS-Goldman fraud charges, earnings sink markets

* Goldman charged with fraud by the SEC, shares plunge

* BofA, GE fall after reporting results

* Google drags on Nasdaq after Q1 results

* Dow drops 0.9 pct, S&P off 1.3 pct, Nasdaq down 1.3 pct

* For up-to-the-minute market news, click [STXNEWS/US]
(Updates to afternoon, changes byline)

By Ryan Vlastelica

NEW YORK, April 16 (BestGrowthStock) – Investors slammed the door
on a six-day winning streak for U.S. stocks (Read more about the stock market today. ) with a sell-off on
Friday after Goldman Sachs was charged with fraud by U.S.
regulators and corporate earnings fell short of heightened
expectations.

Goldman (GS.N: ) fell 12 percent to $162.86 after the
Securities and Exchange Commission alleged it committed fraud
in the structuring and marketing of a debt product tied to
subprime mortgages, which cost investors more than $1 billion.

The financial services giant said the charges were
“completely unfounded in law and fact.” For details see
[ID:nN16131161]

Financial shares around the world sank on the news, with
the KBW banks index (.BKX: ) down 3.6 percent. Morgan Stanley
(MS.N: ) lost 4.7 percent to $29.42.

“Fraud is a huge charge. This could truly cripple Goldman,”
said Rob Stein, managing partner at Astor Asset Management in
Chicago.

Although Stein said he didn’t feel this scenario was
likely, he added, “This certainly proves that financials are
not the place to be for the next step in the recovery.”

The Dow Jones industrial average (.DJI: ) was down 95.60
points, or 0.86 percent, at 11,048.97. The Standard & Poor’s
500 Index (.SPX: ) was down 15.48 points, or 1.28 percent, at
1,196.19. The Nasdaq Composite Index (.IXIC: ) was down 31.36
points, or 1.25 percent, at 2,484.33.

After a rapid rally in recent weeks, Wall Street was down
as Google Inc (Read more about Google Stock Analysis) (GOOG.O: ), Bank of America Corp (BAC.N: ) and
General Electric Co (GE.N: ) reported quarterly results with some
disappointing elements.

Bank of America reported higher-than-expected earnings but
said loan demand was low, while GE posted weak first-quarter
revenue. [ID:nN16232262] and [ID:nN16249166]

BofA fell 4.5 percent to $18.60 and was the top percentage
decliner on the Dow. GE, another Dow component, sank 2.9
percent to $18.93.

Google lost 6.3 percent to $556.98 a day after it posted a
23 percent jump in quarterly revenue, but some investors had
hoped for even better results. [ID:nN15186317]

On the upside, Mattel Inc (MAT.O: ) posted a surprise
first-quarter profit (Read more your timing to make a profit.), sending the stock up 1 percent to $23.97.
Gannett Co Inc (GCI.N: ) also posted a better-than-expected
first-quarter profit (Read more your timing to make a profit.), and the stock rose 2 percent to $18.51
[ID:nN16228746] and [ID:nN16125003]

The Goldman news also had an impact commodities, with crude
oil futures dropping 2.8 percent to $83.15 per barrel.
[ID:nSGE63F052]

In economic news, the Thomson Reuters/University of
Michigan’s Surveys of Consumers showed consumer sentiment took
a surprising negative turn in early April due to a grim outlook
on income and jobs. [ID:nN16108269]

U.S. housing starts rose more than expected in March while
permits to build new homes scaled a 17-month high, according to
a government report. [ID:nN15238704]

Stock Market Research Tools

(Editing by Kenneth Barry)
)

US STOCKS-Goldman fraud charges, earnings sink markets