The Dow Jones Industrial Average had lost more than 130 points at midday, falling 0.99 percent to 13,540.31 after Merrill Lynch (NYSE: MER; TYO: 8675) said that it had written down $7.9 billion in the third quarter, over $2 billion more than it had said that it would have to write off earlier, for a net loss of $2.3 billion in the quarter.

In addition the National Association of Realtors said that existing home sales were down again in September, falling 8 percent during the month for the biggest decline since 1999 and much more than the 4.5 percent that had been expected.

The weak sales sent the median price for an existing home 4.2 percent lower than last year at the same time.

The Nasdaq Composite, meanwhile, was down 1.93 percent to 2,745.37 and the S&P 500 dropped 1.3 percent to 1,499.79.

In the technology sector Intel (NAS: INTC; SEHK: 4335) was $1.08 lower to $25.72 after Broadcom (NAS: BRCM) issued a worse than expected quarterly report Tuesday.

Broadcom was $7.51 lower to $34.55.

Banks took the Merrill Lynch news hard.

Bank of New York (NYSE: BNY) was $1.30 lower to $46.18, while Bear Stearns (NYSE: BSC) was down $4.13 to $112.04.

Internet retailer Amazon (NAS: AMZN) dropped $15.32 to $85.50 even though it reported that its profits in the quarter more than quadrupled.

The New York equities markets were higher at midday on Monday, helped out by falling oil prices. The Dow Jones Industrial average was 0.5 percent higher to 12,256.78, while the Nasdaq Composite was up 1.3 percent to 2,444.20 and the S&P 500 had added 0.6 percent to 1,405.15. The small-cap Russell 2000 index was up 1.6 percent to 793.32, just below its all-time high.

In the financial services sector, Bank of New York said it will purchase Mellon Financial for $16.5 billion, all in stock. If the deal is closed, it will create the largest financial assets service company, with control of around $16,000 billion. Bank of New York had added 11.1 percent on the news by the middle of the day to $39.41, while Mellon gained 4.4 percent to $42.27.

Station Casinos added 18.7 percent to $82.02 and was up to $82.28 earlier in the day after it said it has received a bid from a group of investors headed by the chairman and chief executive of the company. The offer was said to be worth $4.7 billion.

IBM was 1.6 percent higher to $92.73 on positive notice from the press over the weekend.

The pharmaceuticals sector saw declines after Pfizer and Onyx Pharmaceuticals each received bad news about drugs in trials. Pfizer fell 11.8 percent to $24.58 after dropping as low as $23.52 on the announcement that it has abandoned development of its Torcetrapib, intended to treat high cholesterol, after patients in trials had a high incidence of deaths and cardiovascular events. Meanwhile, Onyx dropped 28.9 percent to $12.44 on the announcement that Nexavar, a drug for the treatment of kidney cancer, had not helped skin cancer patients in trials.

The New York equities markets were up at midday on Wednesday after Federal Reserve Chairman Ben Bernanke made comments to a Congressional committee that led analysts to believe that the string of interest rate hikes by the Fed might soon be over. Also encouraging investors were new, positive earnings reports. They seemed not to pay much attention to data indicating that inflation is strong.

At mid-session, the Dow Jones Industrial Average, the Nasdaq Composite, and the S&P 500 were each 1.4 percent higher, to 10,948.51, 1,071.09, and 1,254.23 respectively.

Not included in the strong quarterly earnings reports was Yahoo, which dropped 21 percent to $25.62 on its report that earnings were down 78 percent in the second quarter. The drop in earnings had been expected, but investors were unhappy that a new advertising platform’s introduction had been put off.

Financial sectors did will, however. JPMorgan Chase was up 5.3 percent to $42.87 on higher expected profits in the second quarter, while Bank of New York gained 6.5 percent to $33.91 after it reported second quarter earnings were up by 13 percent.

Among discount brokers, Ameritrade added 5.2 percent to $15.46 and E*trade was up 5.3 percent to $21.95.

Homebuilders saw gains after Mr. Bernanke’s testimony raised the possibility that interest rates might not go too much higher. Lennar added 3.6 percent to $41.96, while Pulte gained 3.8 percent to $28.08.

At midday on Thursday in New York, the Dow Jones Industrial Average was up to its highest level in six years, while the S&P was up only slightly and the Nasdaq Composite had fallen. The Dow was up 0.6 percent to 11,341.61, the S&P had risen 0.1 percent to 1,311.17, and the Nasdaq was down 0.5 percent to 2,359.64.

General Motors was up 9.4 percent to $22.51 on indications that it was beginning to recover from its recent problems. It’s first quarter loss of $323 million was much better than had been predicted, and an analyst at Credit Suisse said that without special expenditures and healthcare costs, GM would have actually posted a small profit for the quarter. Ford Motor, helped by General Motors’ advance, gained 3.4 percent to $7.99.

A sell-off of Ebay stock led to a drop on the day of 8.1 percent to $37.09, hurt the Nasdaq. Ebay’s decline came after it said sales and profits will be lower than had been expected in 2006. However, Nasdaq’s decline was limited by Apple’s advance of 3.4 percent on the day to $69.17. The gain came on a second-quarter report that showed revenue up by 41 percent. Also in computer-related businesses, chipmaker Intel was up 0.2 percent to $19.60 on a better-than-expected first quarter report.

The banking sector was mixed. Bank of America added 1 percent to $46.53 after a report that first-quarter profits were up by 14 percent. Bank of New York, however, was down 2.6 percent to $34.77 even though it reported an 11-percent rise in net income in the first quarter.

Merck gained 1.9 percent to $35.04. The pharmaceutical company said that its quarterly profits were up by 11 percent, more than had been expected.

After gains on Tuesday, New York equities markets were at a virtual standstill at midday on Wednesday as analysts and investors considered what the implications were of new US Federal Reserve Chairman Ben Bernanke’s comments in his first appearance before the US Congress. He said that more interest rate hikes could be in the offing but that the economy seemed to be doing well.

By the middle of the trading day, the Dow Jones Industrial Average hadn’t moved at all, while the Nasdaq composite and the S&P 500 were both up slightly. The Dow was at 11,029.19. The Nasdaq had risen 0.3 percent to 2,268.91, and the S&P had gone up 0.1 percent to 1,276.39.

In the financial sector, Merrill Lynch was up 0.5 percent to $75.52 on the announcement that it will merge its investment management division with Black Rock, which gained 9.6 percent to $159.99. The new company will do business under the Black Rock name.

Elsewhere in banking and finance, Bank of New York and Bear Stearns were both up on upgrades from “neutral” to “buy” from Merrill Lynch. Bank of New York was upgraded on the strength of its processing and banking businesses, and gained 1.1 percent to $33.84. Bear Sterns received an upgrade because Merrill Lynch said its share price does not reflect its potential earnings growth, which sent its shares up 2.1 percent to $132.21.

Despite lower crude oil prices on Tuesday and Wednesday data showing stockpiles up, oil stocks were on the rise. Marathon Oil gained 3.7 percent to $68.97, while Valero Energy was up 3.3 percent to $51.39.

In the retail sector, Abercrombie & Fitch lost 4.2 percent to $65.89 despite reports of a 58 percent rise in profits in the fourth quarter. The loss came due to a warning that full-year earnings were likely not going to meet expectations.