* IBM boosts dividend, to buy back stock
* Citigroup talking to U.S. govt on capital levels
* Economic data give stocks support
* New Zealand, Israel confirm cases of swine flu
* Dow off 0.1 pct, S&P and Nasdaq down 0.3 pct
* For up-to-the-minute market news click []
(Updates to close)
By Chuck Mikolajczak
NEW YORK, April 28 (Reuters) - U.S. stocks fell on Tuesday
as fresh worries that major banks may need to raise more money
offset more reassuring economic data that suggested the worst
may be over and a big dividend boost from IBM.
Worries also lingered over the economic impact from the
threat of a flu pandemic, as New Zealand and Israel were the
latest countries to confirm cases of a new strain of flu
linked to dozens of deaths in Mexico. (For details, see
[])
U.S. regulators have told Citigroup Inc <C.N> it may need
to raise more capital, sources told Reuters. The Wall Street
Journal reported that Bank of America <BAC.N> also is talking
to the government about its capital condition and the
shortfall could amount to billions of dollars.
[]
But data showed the decline in U.S. house prices slowed in
February while consumer confidence in April had its biggest
jump in more than three years. []
International Business Machines Corp <IBM.N> gave the Dow
its biggest boost, up 2 percent at $101.94 after its board
approved a 10 percent increase in its dividend and authorized
a stock buyback, highlighting resilience in a tough economic
climate. []
Although Wall Street closed out the session in negative
territory, the major indexes recovered from their session
lows, when they slid more than 1 percent.
"Two days in a row, where you walked in with a pretty weak
pre-opening market largely driven by what's gone on overseas,
swine flu, etc and we managed to come back -- that's a sign of
a healthy market," said Kevin Kruszenski, head of listed
trading at KeyBanc Capital Markets in Cleveland.
"A lot of this (bank decline) has been telegraphed --
banks have started to retreat and digest a little bit of the
move that they've had. They've had a pretty nice move off the
bottom."
The Dow Jones industrial average <> slipped 8.05
points, or 0.10 percent, to 8,016.95. The Standard & Poor's
500 Index <.SPX> dropped 2.35 points, or 0.27 percent, to
855.16. The Nasdaq Composite Index <> declined 5.60
points, or 0.33 percent, to 1,673.81.
Citigroup is talking to the U.S. government about its
capital levels after receiving early results of its stress
test, but if it needs more capital, the bank does not expect
to get it from the government, people familiar with the matter
told Reuters. []
Bank of America's stock tumbled 8.6 percent to $8.15 and
ranked among the top weights on the blue-chip Dow, while
Citigroup lost 5.9 percent to $2.89. The KBW Bank index <.BKX>
slid 2.9 percent.
On Nasdaq, shares of Dendreon <DNDN.O> were halted, down
45.2 percent at $11.81, after a closely watched study showed
the company's experimental cancer vaccine improved three-year
survival of patients with advanced prostate cancer by 38
percent, compared with a placebo.
Trading was light on the New York Stock Exchange, with
about 1.25 billion shares changing hands, below last year's
estimated daily average of 1.49 billion, while on Nasdaq,
about 2.10 billion shares traded, below last year's daily
average of 2.28 billion.
Even though the major U.S. stock indexes slipped late and
finished slightly lower, the market's breadth was positive.
On the NYSE, advancing stocks outnumbered declining ones
by 1,581 to 1,409, while on the Nasdaq, advancers beat
decliners by 1,547 to 1,110.
(Reporting by Chuck Mikolajczak; Editing by Jan Paschal)
