GM, Ford shares slip after Bear Stearns downgrade

DETROIT (Reuters) - Shares in automakers General Motors Corp and Ford Motor Co slid in early trade on Wednesday after Bear Stearns downgraded both companies citing concerns over weakening consumer purchasing power.

In a research note to clients, analyst Peter Nesvold wrote that the "facts are changing at an accelerating rate; and when the facts change, we must change our view."

Last Friday GM reported a surprise 2.6 percent increase in January U.S. vehicle sales, while Ford said sales declined by 3.6 percent during the month.

Bear Stearns' Nesvold wrote that in the case of GM "we expect heightened incentives and continued market share losses for the foreseeable future into a fading product cadence and a declining '08 market."

In New York Stock Exchange trade, GM shares were down 2.5 percent to $25.80, while Ford was down 1.2 percent to $6.35.