US REPORT: Dow Jones:8,016.95 (-8.05) SP 500:855.16 (-2.35 ) Nasdaq:1,673.81 (-5.60)

US STOCKS fell yesterday as fresh worries that banks may need to raise more money offset more reassuring economic data that suggested the worst may be over and a big dividend boost from IBM.

Worries also lingered over the economic impact from the threat of a flu pandemic, as New Zealand and Israel were the latest countries to confirm cases of a new strain of flu linked to deaths in Mexico.

US regulators have told Citigroupit may need to raise more capital. The Wall Street Journalreported Bank of Americawas also talking to the government about its capital condition and the shortfall could amount to billions of dollars.

But data showed the decline in US house prices slowed in February while consumer confidence in April had its biggest jump in more than three years.

IBM gave the Dow its biggest boost, up 2 per cent at $101.94 after its board approved a 10 percent increase in its dividend and authorised a stock buyback, highlighting resilience in a tough economic climate.

Although Wall Street closed out the session in negative territory, the major indexes recovered from their session lows, when they slid more than 1 per cent.

The Dow Jones industrial average slipped 8.05 points, or 0.10 per cent, to 8,016.95. The Standard Poor’s 500 Index dropped 2.35 points, or 0.27 per cent, to 855.16. The Nasdaq Composite Index declined 5.60 points, or 0.33 per cent, to 1,673.81.

The Dow is up 22.5 per cent from its 12-year closing low on March 9th. For the month of April alone, the Dow is up 5.4 per cent. But it remains down 8.7 per cent for the year.

Citigroup is talking to the US government about its capital levels after receiving early results of its stress test, but if it needs more capital, the bank does not expect to get it from the government.

Bank of America’s stock tumbled 8.6 per cent to $8.15 and ranked among the top weights on the blue-chip Dow, while Citigroup lost 5.9 per cent to $2.89.

On Nasdaq, shares of Dendreonwere down 45.2 per cent at $11.81, after a study showed the company's experimental cancer vaccine improved three-year survival of patients with advanced prostate cancer by 38 per cent, compared with a placebo. – (Reuters)