(By Salman - iStockAnalyst Writer)

US stocks retreated on Wednesday as investors were rattled by worse than expected existing home sales data.

The Dow Jones Industrial Average shed 80.05 points or 1.09% to finish at 7,270.89. The S&P 500 slipped 8.24 or 1.07% to 764.90. The Nasdaq Composite retreated 16.40 points or 1.14% to 1,425.43.

According to the National Association of Realtors, existing home sales fell 5.3% in January, to a seasonally adjusted annual rate of 4.49 million units from a rate of 4.74 million in December. Economists had projected a reading of 4.79 million.

Also, the Mortgage Bankers Association said that its market index of mortgage application volume fell 15.1% on a seasonally adjusted basis for the week of February 20th.

In a testimony before congressional lawmakers Federal Reserve Chairman Ben Bernanke reiterated that the US government has no plan to nationalize US banks.

Meanwhile, President Barack Obama urged Congress to pass strong financial sector regulation and oversight to prevent future crises and restore "accountability, transparency and trust in our financial markets."

Citigroup Inc. (NYSE: C) slumped 8 cents or 3.08% to $2.52.

Bank of America (NYSE: BAC) surged 43 cents or 9.09% to $5.16 after CEO Kenneth Lewis said that  Merrill Lynch and Countrywide have been “stars” so far this year. Earlier, in its annual report filed with the U.S. Securities and Exchange Commission, Merrill Lynch & Co. said that it lost $15.84 billion in the fourth quarter, about $533 million more than the loss previously reported by Bank of America Corp. (NYSE: BAC).

JP Morgan (NYSE: JPM) rose 71 cents or 3.38% to $21.73. American Express Co. (NYSE: AXP) subtracted 55 cents or 4.04% to end at $13.07.

Shares of Lincoln National Corp. (NYSE: LNC) slid $1.83 or 14.03% to $11.21 after it slashed its quarterly dividend by 95% to 1 cent a share in order to enhance "capital and financial flexibility given the continued disruption in the capital markets."

Ambac Financial (NYSE: ABK) tumbled 10 cents or 9.90% to 91 cents after the company announced that its fourth-quarter net loss narrowed to $2.34 billion or $8.14 a share compared to a loss of $3.27 billion, or $32.03 in prior year quarter.

General Motors (NYSE: GM) soared 33 cents or 14.86% to $2.55.

Shares of oil giant Chevron Corp. (NYSE: CVX) plunged $1.78 or 2.73% to $63.50.

Equipment maker Caterpillar (NYSE: CAT) skidded $1.01 or 3.88% to $25.03    

Late on Tuesday, First Solar, Inc. (NASDAQ: FSLR) said that its fourth quarter profit jumped to $132.77 million or $1.61 per share from $62.87 million or $0.77 per share in the comparable quarter, a year ago. Revenue more than doubled to $433.65 million from $200.8 million. Shares of the company plummeted $30.03 or 21.81% to $107.65.

Wynn Resorts (NASDAQ: WYNN) sank $4.05 or 15.70% to $21.75 after the casino operator said that it slipped to a fourth quarter loss of $159.6 million, or $1.49 a share from a profit of $65.5 million, or 57 cents a share in the fourth quarter of 2007.  On an adjusted basis, the company earned $7.6 million, or 7 cents a share. Revenue plunged to $614.3 million from $711.3 million.

DreamWorks Animation Inc. (NYSE: DWA) lost $2.14 or 10.83% to end at $17.62 after it reported that fourth-quarter net income fell to $51.6 million, or 58 cents a share, from $94.1 million, or 98 cents a share, in the year ago quarter. Revenue declined to $199.8 million from $290.2 million.51 billion.

European stocks settled mostly lower. The U.K. FTSE gained 32.54 points or 0.85% to close at 3,848.98. The German DAX and French CAC decreased 1.27% and 0.37% respectively.

Asian stocks finished with solid gains. The Nikkei 225 rose 192.66 points or 2.65% to 7,461.22. The Hang Seng index of Hong Kong advanced 206.56 points or 1.61% to 13,005.08.

NYMEX crude oil for April delivery climbed $2.48 or 6.2% to settle at $42.44 a barrel.
 
Disclosure: Author does not own any of the stocks discussed here.