U.S. financial stocks dropped as investors pulled money from the sector. The collapse in Bear Stearns stock shocked investors and left them worried of the fate of Merrill Lynch, Lehman Brothers, Goldman Sachs, and Morgan Stanley. Lehman plunged 50% after its chief executive said the added liquidity from the Fed will help the financial system. The vague statement concerned investors that Lehman may be facing liquidity crunch, which the company denied. |
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