Citigroup CEO Vikram Pandit

US stocks fell as expected on Tuesday. Citgroup's big write-downs were not a surprise but weak retail-sales data added to the gloom.

The Dow Jones Industrial Average fell 219 points, or 1.71%, at 12559. The Standard & Poor's 500 was off 2.25%, or 32 points, at 1384 and the  tech-dominant Nasdaq Composite Index fell 2.19%, or 54 points, to 2424.

Citigroup Inc. today reported a net loss for the 2007 fourth quarter of $9.83 billion, or $1.99 per share. Results included $18.1 billion in pre-tax write-downs and credit costs on sub-prime related direct exposures in fixed income markets, and a $4.1 billion increase in credit costs in US consumer primarily related to higher current and estimated losses on consumer loans. 

Citi's share price fell 6.26%.

Struggling investment bank Merrill Lynch, which will report earnings on Thursday and is also expected to announce huge subprime related write-downs, announced today that it was getting a $6.6 billion capital injection, mainly from sovereign wealth funds of Kuwait and Korea as well as Japan's Mizuho Corporate Bank. Merrill Lynch's share price is down 3.4% Tuesday.

US Retail sales fell in December and while there was a slight drop in producer prices, the annual rate at 6.3% was the highest since 1981 - report.

Live US Indices

European stocks fell sharply on Tuesday with retailers and financial companies in focus, after Tesco Plc reported Christmas sales that were below analysts' while UL luxury goods maker Burberry Group Plc dropped 12% after reporting a fall in full year earnings.

In Germany, Hypo Real Estate fell over 36% after saying pretax profit fell in 2007.

The Dow Jones Stoxx 600 Index plunged 2.27% and sentiment wasn't helped after the ZEW Center for European Economic Research said its index of investor sentiment in Germany plunged to the lowest in 15 years.

National benchmarks slumped in all of the 18 western European markets. France's CAC 40 fell 2.83%; the UK's FTSE 100 slid 2.23% and. Germany's DAX dropped 1.2%.

In Dublin, the ISEQ Index fell 3.76%.

Anglo Irish dropped 5.55% and AIB is down 4.49%.