Automotive and Financial Stocks Lead Sell-Off

Investors continued to worry about mounting losses among automotive and financial services firms.  The Dow gave up earlier gains to close at 8870, down 73 points.  Nasdaq tumbled 30 points to finish the trading session at 1616.

On the upside

Shares of Geron (Nasdaq: GERN) and StemCells, Inc. (Nasdaq: STEM) rose on hopes that an Obama administration may lead to a favorable business environment for stem cell companies.

Worries of a possible ban on firearm sales led to a surge in gun buying which lifted shares of Smith & Wesson (Nasdaq: SWHC).

Las Vegas Sands (NYSE: LVS) managed to raise $2.14 billion in new capital, but the new funding missed targets as the struggling casino operator suspended development of a condominium tower in Las Vegas.

On the downside

Starbucks (Nasdaq: SBUX) posted slightly higher revenues and a slim profit that missed expectations as the coffee purveyor closed 600 stores and cut more than 1000 positions.

General Motors (NYSE: GM) warned that the mortgage unit of its finance arm may not survive as the stock plummeted to its lowest level in 60 years.

Shares of American Capital (Nasdaq: ACAS) tumbled to an all-time low after the investment firm reported a quarterly loss and suspended its dividend.

In the broad market, declining issues outpaced advancers by a margin of more than 2 to 1 on both the NYSE and Nasdaq.  The Russell 2000 which tracks small cap stocks lost 12 points to close at 493.