Stocks were heading lower on Friday in a volatile session led by financials. The XLF financial sector ETF was recently lower by 5.17% as components Citigroup and Bank of America fell 20.72% and 18.32% respectively, with Citi under $2 per share as fear of nationalization grew.

Bank of America CEO Ken Lewis tried to assure his senior team on Thursday that the bank would not be seized by the government.  As nationalization talk gains momentum in Washington, Lewis also reportedly asked the government to say publicly that it is not considering this option.

Senate Banking Committee Chairman Christopher Dodd said President Obama is seeking to avoid nationalizing banks and that the administration and Treasury Secretary Timothy Geithner are “working hard” on programs to help rescue the financial-services industry.

In recent trade, the DOW was moving lower by 1.57%. The broader S&P 500 was lower by 1.59% and the NASDAQ by 0.55%. The dollar was lower across the board, with declines of 0.98% to the euro, 0.50% to the yen 0.57% against Australia's dollar and 0.94% to the pound.

Crude was giving back some of Thursday's gains with a recent decline of $1.00 (-2.53%) to $38.48 per barrel.

Gold broke the thousand dollar level earlier today but was recently higher by $21.30 (2.18%) to $997.40 per ounce.