(Updates to afternoon, changes byline)
By Caroline Valetkevitch
NEW YORK, Feb 25 (Reuters) - The Dow gained in seesaw
trading on Monday following the energy sector's gains, while
renewed concerns about subprime-related losses at the biggest
U.S. banks limited the broader market's advance.
Energy companies' shares, including Exxon Mobil Corp
<XOM.N>, rose as oil prices remained above $99 a barrel after
hitting record highs last week. An S&P index of energy shares
<.GSPE> was up 1.7 percent.
But investors unloaded shares of banks like Citigroup Inc
<C.N> following a report from Goldman Sachs that it expects
several more multibillion-dollar write-downs across the
sector. A potential $12 billion loss at Citi topped the list.
Goldman also sees more write-downs from JPMorgan Chase &
Co <JPM.N>, Merrill Lynch & Co Inc <MER.N> and Morgan Stanley
<MS.N>.
Optimism about the latest merger news also gave some
support after video game publisher Electronic Arts Inc
<ERTS.O> made an unsolicited $1.9 billion offer for smaller
rival Take-Two Interactive Software <TTWO.O>.
"We've got energy stocks pretty much leading the market
today. If you're an equity manager, that's not a bad place to
go because you know (those companies) are going to generate
profits," said Tim Smalls, head of U.S. stock trading at
brokerage firm Execution LLC in Greenwich, Connecticut.
"Financials are scary again. Those rumbles about Citigroup
don't help."
The Dow Jones industrial average <> was up 61.14
points, or 0.49 percent, at 12,442.16. The Standard & Poor's
500 Index <.SPX> was up 4.08 points, or 0.30 percent, at
1,357.19. The Nasdaq Composite Index <> was up 3.20
points, or 0.14 percent, at 2,306.55.
Weighing on the financial sector was Oppenheimer's cut in
its earnings outlook on a handful of banks, including Bank of
America <BAC.N>, Citigroup <C.N> and Wells Fargo & Co
<WFC.N>.
Shares of Ambac Financial Group Inc <ABK.N> dipped 0.09
percent to $10.70 after a person briefed on the matter said
any deal to rescue the bond insurer would likely be signed
early next week rather than today or tomorrow. For details,
see []
On Monday, Dresdner Bank said it intends to support a
rescue package for Ambac. Late on Friday, Ambac lifted the
stock market on talk that the rescue plan would be announced
soon.
Citigroup shares slid 3.4 percent to $24.26 and JPMorgan
stock dropped 1.9 percent to $43.12.
Take-Two shares jumped 54.2 percent to $26.76, while
shares of Electronic Arts fell 6.5 percent to $46.53. Both
trade on the Nasdaq.
A decline in January sales of existing homes was less than
the market expected, but the report also showed an increase in
the inventory of homes for sale.
(Editing by Jan Paschal)
