US stocks were nearly flat in Mid-day trading on Monday, recovering after earlier losses following continued concerns over a weakening credit market and a worsening subprime mortgage situation.
Global investment bank, Goldman Sachs Group Inc. said HSBC Holdings Plc faces $12 billion in additional write offs for subprime defaults. In addition, Europe's largest bank plans to assume ownership of two troubled funds and injecting $35 billion. Meanwhile, banks showed more signs of having been hurt by credit market problems. Citigroup Inc. was reportedly looking to cut costs by raising the possibility of further job cuts.
Concern over the mortgage market caused Morgan Stanley, Lehman Brothers Holdings Inc. and Merrill Lynch & Co. to decline as losses deepened in securities tied to home loans. Fannie Mae and Freddie Mac, the largest U.S. mortgage-finance companies, dipped after UBS AG said higher credit costs will cause earnings growth to slow.
In mid-day trading, the Dow Jones industrial average was up 10.89 points, or 0.08 percent to 12,991.77. Broader stock indicators fell the Standard & Poor's 500 index fell 2.96, or 0.21 percent to 1,437.74, and the Nasdaq Composite Index fell 1.50, or 0.06 percent to 2,595.10.