Morning slide extended

Small-cap stocks extended the morning slide into midday trading, with financial, tech and homebuilder shares overpowering gains in energy and commodity names. Analyst downgrades for key companies in the financial and technology arenas played a role in magnifying worries about consumer spending and the never-ending credit crisis. At 12:21 p.m. ET, the Russell 2000 (NYSE:IWM) was down 11.08, or 2.36% at 457.35.

On the banking/financial front, analysts downgraded JP Morgan Chase and Co. (NYSE:JPM) and the firm was one of the major drags on large-cap indices, sinking some 6.8% and spreading selling in financial firms throughout the market. Analysts also downgraded Apple Inc. (Nasdaq:AAPL), which tumbled nearly 4% and sparked a slide throughout the technology arena. The tech-laden Nasdaq 100 was down 2.2% at mid-session, about double the percentage losses seen in the S&P 500 and Dow.

The Treasury Department announced it was reviewing information from the auto industry and providing regular updates to the White House, which kept enthusiasm for some kind of bailout for U.S. automakers running high. Even though the overall market was falling today, shares in General Motors Corp. (NYSE:GM) were up 5.5%, while Ford Motor Co. (NYSE:F) was up 3.6%.

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