Today's Key Market News: Hard to Sell a Rock These Days

After last week's market rise in anticipation of a Federal Reserve target rate cut this week, the market is second guessing this morning. The three most widely followed indexes, the Dow Jones, S&P 500 and NASDAQ have all started the day lower, as market participants begin to question whether, and by how much, the Fed might act. Beyond that, perhaps the market is already thinking, so what next?

In England, we've discovered it's harder to sell a rock these days then it was in the 70s. Northern Rock's (LSE: NRK.L) shares were halted Monday, as depositors lined up again before sunrise to get their money out of the flailing concern. Guess what, that's not going to help business any either, and the bank's managers are now aggressively seeking an exit strategy. It seems the only way to restore confidence in depositors would be to sell the company to a larger concern. The Financial Times reported today that the Rock has spoken with Lloyds TSB (NYSE: LYG), the UK's fifth largest bank, in that regard. But, it's hard enough to sell a rock, let alone a crumbling one.

This week, four major investment banks prepare to report earnings, Lehman Brothers (NYSE: LEH), Goldman Sachs (NYSE: GS), Morgan Stanley (NYSE: MS) and Bear Stearns (NYSE: BSC). The market has anticipated this quarter's reports for quite some time now, and appropriately marked down the shares as analysts have sharply cut estimates. We thought it was quite interesting, however, that Merrill Lynch's (NYSE: MER) industry analyst downgraded many of his firm's peers last week, especially since it came just a few days before MER issued a filing to the SEC on Friday indicating that it had made fair value adjustments to financial instruments, reflecting credit market difficulties. Read into that as you like... Please find today's market-moving news below.

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