The troubled banking sector again pulled down stocks on Wall Street, sending the market to its fifth weekly loss in six weeks and the worst performance since the bear-market lows in late November.

Throughout the week, pessimism gradually spread among investors that the political wrangling over the White House’s economic stimulus package might not produce effective cures for the US economy's ills.

Wells Fargo, the second largest US home lender, fell 6% after its fourth quarter loss was wider than first reported. Bank of America and JPMorgan Chase retreated more than 5% after Lloyds in the UK said it expects HBOS, the lender it took over last month, to report a bigger-than-expected 2008 loss.

Benchmark indexes on Wall Street fluctuated earlier as gains in technology and energy shares offset the drop in banks.

The main Dow Jones index fell 82.35 points, or 1%, to 7850.41 – a 5.2% drop on the week. The S&P 500 also shed 1% to 826.83 for a weekly drop of 4.8%.

Canadian stocks fell every day this week as technology and financial companies declined on speculation the deepening recession will hurt demand and profits.

Blackberry maker Research In Motion dropped 5.9% after a downgrade while blue chip Manulife Financial touched its lowest price in almost six years after reporting its first loss as a public company.

The S&P/TSX Composite Index fell 1.2% to 8678.10 for a weekly loss of 3.7%, its biggest in two months.

Canada has fallen less this year than markets in the US, Australia, Spain, the UK, Germany, Hong Kong, France, Switzerland and Japan as investors seek gold and bank stocks. Canada’s fall was 3.4% compared with the group’s median fall of more than double that at 7.1%.

Stocks in Europe climbed for the first time in four days, as profits at Pernod Ricard beat analysts’ estimates and the first advance in oil this week lifted energy shares.

Pernod, the world’s second-largest liquor company, rose 6%, the most this year.

The Dow Jones Stoxx 600 Index gained 0.3% to 191.27 on Friday but was down 3.7% for the week.

National benchmark indexes gained in 12 of the 18 western European markets.

The UK’s FTSE 100 slipped 0.3% to 4189.59, a 2.4% slide for the week, after Lloyds tumbled 32% as it revealed £10 billion in losses from the HBOS acquisition.

France’s CAC 40 added 33.52, or 1.1%, to 2,997.86, a drop of 4% this week, while Germany’s DAX added 0.1% to 4413.39, limiting its weekly slide to 5%.

Commodities: Oil, gold down

Crude oil fell to the lowest close in more than seven weeks in New York on concern inventories will extend increases as demand drops.

Consultants Wood Mackenzie say world oil consumption will drop 1.7% to 84.3 million barrels a day this year.

Crude oil for March delivery fell $US1.96, or 5.5%, to $US33.98 a barrel in New York, the lowest settlement since December 19. It was the fifth consecutive daily decline. Oil is down 24% this year and 63% from a year ago.

Gold prices fell as demand eased after a three-day rally to the highest since July. Platinum also declined.

Gold futures for April delivery dropped $US7, or 0.7%, to $US942.20 an ounce in New York and gained 3.1% this week.

Currencies: Yen, dollar up

The yen and dollar recorded weekly gains against most of the other major currencies as market volatility strengthened their status as safe havens.

The yen advanced 0.4% to ¥118.37 versus the euro this week from 118.85 on February 6. The dollar appreciated 0.5% to $US1.2874 per euro. The dollar was little changed at ¥91.94 this week after increasing 1.1%.

Chile’s peso was one of the biggest gainers against the dollar among the 177 currencies tracked by Bloomberg after the central bank cut the target lending rate by 2.5%age points to 4.75%, the sharpest reduction in at least a decade.

The pound rose against the dollar, snapping a three-day decline, after earlier gains in stocks revived demand for riskier currencies. Sterling also climbed against the euro and the yen.

The pound climbed 0.8% to $US1.4385, paring its decline this week to 2.7%. The currency advanced 0.7% against the euro to 89.55p, trimming its drop since February 6 to 2.3%. It strengthened 1.6% to ¥131.89, for a five-day slide of 2.9%.

Canada’s loonie posted its worst performance in four weeks. It dropped 1.2% in the past five sessions as crude oil, source of a tenth of Canada’s export revenue, fell below $US35 a barrel. It last traded at $C1.2345 per US dollar and buys 81USc.

• The US Congress passed President Barack Obama’s $US787 billion economic stimulus plan by 246 votes to 183, with no Republicans in favour and seven Democrats against. The Senate is set to approve the package before it goes to President Obama for signing.