Wall St. slides as banks offset housing optimism

NEW YORK (Reuters) - Stocks dipped on Friday as persistent worries about the banking sector tempered news the Obama administration was set to announce on Wednesday a plan to stem home foreclosures.

Even though investors were initially enthused by the news on the housing front, the boost proved short-lived as doubts lingered about how banks will be relieved of their toxic assets.

Shares of Bank of America fell 1.7 percent to $5.76 on the New York Stock Exchange, while JPMorgan shed 3.3 percent to $25.30, making the stock one of the top drags on the Dow.

"The banks are still a concern, plus we have a long weekend coming up," said Peter Jankovskis, director of research at OakBrook Investments LLC in Lisle, Illinois. "There are people that may be deciding they want to be out of the market for a few days.

The Dow Jones industrial average fell 27.63 points, or 0.35 percent, to 7,905.13. The Standard & Poor's 500 Index shed 2.70 points, or 0.32 percent, to 832.49. The Nasdaq Composite Index added 1.39 points, or 0.09 percent, to 1,543.10.

But shares of big manufacturers moved higher, as they are among companies set to benefit from the $787 billion economic stimulus that the U.S. Congress is expected to approve later on Friday.

Boeing climbed 1.6 percent to $40.50, making the stock a top boost to the Dow, while Caterpillar Inc added 0.4 percent to $31.15.

Shares of big-cap tech shares, including Qualcomm and Oracle helped lift the Nasdaq. Qualcomm gained 1.6 percent to $36.09 and Oracle rose 1.7 percent to $17.85.

(Editing by Chizu Nomiyama)