U.S. stocks fluctuated as financial shares slumped after the Federal Deposit Insurance Corp. said the number of “problem” banks grew to the most in 15 years, while SanDisk Corp. led a rally in technology shares KeyCorp lost 5 percent and U.S. Bancorp slid 2.1 percent after FDIC Chairman Sheila Bair said the 21 percent increase in “problem” lenders shows the “banking industry still faces tremendous challenges.” SanDisk rallied 18 percent for the top gain in the Standard & Poor’s 500 Index after Samsung Electronics renewed a patent-licensing agreement with the maker of NAND flash memory chips. The S&P 500, which has rebounded 35 percent from a 12-year low in March, added less than 0.1 percent to 910.65 at 10:42 a.m. in New York. The Dow Jones Industrial Average decreased 17.28 points, or 0.2 percent, to 8,456.21. Benchmark indexes in Asia and Europe rose. “Bair is basically saying that although capital ratios have improved dramatically, the banking industry has real issues,” said Mark Bronzo, a money manager at Security Global Investors, which oversees $21 billion in Irvington, New York. “Whenever you say that, the market gets nervous. It indicates that they’re still going to need to raise more capital, that we’re not completely through this financial crisis.” The biggest gain in consumer confidence since 2003 sent the S&P 500 up 2.6 percent yesterday, ending a four-day decline. The index closed above its average price from the past month yesterday, a level that analysts who track charts say may trigger more gains. SanDisk Rallies SanDisk rallied 18 percent to $16.04. The licensing deal will run from August this year until August 2016, Suwon, South Korea-based Samsung said in a regulatory filing today. The agreement renews a previous contract that covered seven years from August 2002, Samsung said. General Motors Corp. tumbled 13 percent to $1.26 after failing to get 90 percent of its bondholders to swap claims for stock, pushing the company closer to bankruptcy. Monsanto Co. fell 4.9 percent to $81.08 after the world’s largest seed producer said 2009 ongoing earnings will be about $4.40 a share, the lowest point of its forecasted range of $4.40 to $4.50, because of stronger-than-expected competition in its herbicide business. The company was expected to earn $4.59 a share, according to the average estimate of analysts surveyed by Bloomberg. The world’s largest economy will begin to expand next quarter, according to 74 percent of economists in a National Association for Business Economics survey. Compared with NABE’s February poll, growth will be slower and unemployment will be higher in the second half of this year and through 2010. Per-share earnings topped analysts’ estimates at two-thirds of the 467 companies in the S&P 500 that have reported results since April 7, even as profits dropped 35 percent on average, according to data compiled by Bloomberg. Allegheny Technologies Inc. retreated 3.9 percent to $34.43. The specialty-metal producer said it will sell $300 million of senior notes due 2019 and $350 million of convertible notes due 2014.

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