Wall Street declines on concerns about financial sector

NEW YORK, July 7 (Xinhua) -- Wall Street declined Monday after a volatile trading day as investors worried about the possibility of financial troubles of Fannie Mae and Freddie Mac.

San Francisco Federal Reserve President Janet Yellen said that the financial markets would get worse before and it will take time for conditions to improve. The comments raised concerns on financial sector.

Meanwhile, Lehman Brothers analysts pointed out in a note that Fannie and Freddie, the two major U.S. government-backed mortgage lenders, may need to raise more capital as the credit crisis continues. Shares of Fannie Mae fell 16.2 percent and Freddie Mac fell 17.9 percent.

Major U.S. banks, Citigroup Inc., JPMorgan Chase & Co., and Bank of America Corp. also saw their shares fall ahead of their earnings reports later this month.

The Dow Jones Industrial Average fell 56.58, or 0.50 percent, to 11,231.96. The Standard & Poor's 500 index fell 10.59, or 0.84 percent, to 1,252.31, and the Nasdaq composite index fell 2.06, or 0.09 percent, to 2,243.32.