Remain lower; commodities taking a pounding

Small-cap stocks remained lower into mid-session, pulled down by losses in commodity, financial and technology stocks amid ongoing worries about corporate profits in one of the deepest economic recessions since the Great Depression. At 12:43 p.m. ET, the Russell 2000 (NYSE:IWM) was down 5.11, or 1.06%, at 476.18.

Commodities were hit especially hard today, with crude oil prices tumbling 7% on worries about the global demand picture. Elsewhere in commodities, corn futures crashed 7%, touching limit down losses and the Gold and Silver Index slumped more than 5%, reflecting losses for mining and metals shares. Small-cap coal company Patriot Coal Corp. (NYSE:PCX) fell 17.3%. In addition to the general decline in energy and commodities, PCX announced late Friday that they would close their Jupiter mining complex. Small-cap gold stock Detour Gold Corp. (OBB:DRGDF) was down 21%.

Treasury Secretary Henry Paulson said that the U.S. economy was going through a “difficult” economic period, which isn’t exactly a fresh revelation, but which did appear to spook investors and extend the morning pullback in equities. Credit markets were higher, which pulled some money flow away from stocks.

Homebuilder shares were taking a hit today, with small-cap builders Centex Corp. (NYSE:CTX) down 7.7%; KB Home (NYSE:KBH) off 6.2% and Meritage Homes Corp. (NYSE:MTH) down 10.5%.

Looking at the financial arena, bank stocks were getting drubbed, with the KBW Banking Index off 3.6% and Citigroup Inc. (NYSE:C), down more than 10% amid analyst talk that the bank may still need more capital even after . . .

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