Wachovia Corp. tumbled to the lowest since 1992 after an analyst said the lender may cut its payout, while Merrill Lynch & Co. and Citigroup Inc. dropped as JPMorgan Chase & Co. said prices for some mortgage securities may sink further. Lehman Brothers Holdings Inc. plunged as traders speculated the fourth- largest U.S. securities firm may be sold for less than its market value. Devon Energy Corp. led gains in oil producers, which sent the Standard & Poor's 500 Index and Dow Jones Industrial Average higher, after analysts increased profit estimates through 2009.
Three stocks dropped for every two that rose on the New York Stock Exchange. The S&P 500 increased 1.62 points, or 0.1 percent, to 1,280, paring its retreat this month to 8.6 percent. The Dow added 3.5 to 11,350.01. The Nasdaq Composite Index lost 22.65, or 1 percent, to 2,292.98.
The Dow pared its monthly retreat to 10.2 percent, still the biggest June loss for the 30-stock gauge since 1930. The measure dropped 7.4 percent since the end of March for its third-straight quarterly slide, the longest stretch of declines since 1978. The S&P 500 slid 3.2 percent during the quarter, while the Nasdaq increased 0.6 percent.
Stocks traded higher for most of the day as energy shares climbed and a gauge of business spending topped economists' forecasts.
Lehman, which lost almost half of its market value this quarter, dropped $2.44, or 11 percent, to $19.81, the lowest since 2000.
The Financial Select Sector SPDR Fund, a so-called exchange traded fund that tracks U.S. financial stocks, lost 1.5 percent to $20.26, the lowest since March 2003. The shares, known by their XLF ticker, were the second most-traded among stocks and ETFs in New York today.