* Focus on Obama's bank rescue plan, stimulus package
* Bernanke due to testify on Capitol Hill
* Financial shares drop before the bell
* For up-to-the-minute market news, click []
(Recasts first paragraph, updates prices)
By Ellis Mnyandu
NEW YORK, Feb 10 (Reuters) - U.S. stocks were set to dip at
the open on Tuesday on worries that the Obama administration's
plans to shore up the financial sector and stimulate the
economy may not be enough to contain the worst financial crisis
since the 1930s.
A day after U.S. President Barack Obama warned that the
recession could get much worse, investors held out hope that
Treasury Secretary Timothy Geithner would restore confidence in
the financial system when he unveils a plan to relieve banks of
money-losing assets.
Before the bell, the Financial Select Sector SPDR <XLF.P> ,
an exchange-traded fund which tracks the performance of stocks
in the Standard & Poor's 500 financials group, fell 1 percent,
while Bank of America <BAC.N> shares were flat at $6.88.
Citigroup <C.N> shares rose about 1 percent to $3.98, while
JPMorgan <JPM.N> edged down about 2 percent to $26.95.
Shares of U.S. property and life insurer Hartford Financial
Services Group <HIG.N> slid 5.7 percent to $14.17 before the
bell after its credit ratings were cut. Rival MetLife <MET.N> ,
the No. 1 U.S. life insurer, was down 4.1 percent at $29.99.
"There's skepticism about the administration's ability to
get us out of the quicksand," said Andre Bakhos, president of
Princeton Financial Group in New Brunswick, New Jersey. "The
problems are so deep. There's a feeling that's growing, that
they are throwing good money after bad."
S&P 500 futures <SPc1> fell 8.00 points and were below fair
value, a formula that evaluates pricing by taking into account
interest rates, dividends and time to expiration on the
contract. Dow Jones industrial average futures <DJc1> fell 60
points, and Nasdaq 100 <NDc1> futures declined 5 points.
In addition to the bank plan, investors will also be
watching the Senate, which is expected to approve a stimulus
package worth more than $800 billion on Tuesday. Geithner is
due to present his bank plan at 11 a.m. (1600 GMT).
The stimulus and the bank rescue plan are a make-or-break
for stock investors searching for catalysts to sustain the
market's recovery attempt since stocks hit a bear market low in
November.
General Motors Corp <GM.N> offered more bleak news on the
labor market as the automaker announced plans to cut 10,000
salaried workers from its global workforce. For details, see
[]
In other developments, Federal Reserve Chairman Ben
Bernanke is scheduled to testify before the House of
Representatives Financial Services Committee starting at 1 p.m.
(1800 GMT) on steps the U.S. central bank is taking to provide
money to financial markets.
The focus on what Washington comes with Wall Street more
than half-way through the latest earnings season which has
served to underscore the toll of the worsening recession on
corporate profitability.
(Reporting by Ellis Mnyandu; Editing by Tom Hals)
