Sept. 29 (Bloomberg) -- U.S. stock-index futures dropped as bank bailouts accelerated and a $700 billion plan from Congress to rescue the financial industry failed to unlock money markets.

Citigroup Inc. lost 4 percent and JPMorgan Chase & Co. decreased 6.2 percent after the bailout of Belgium's Fortis and seizure of U.K. mortgage lender Bradford & Bingley prompted banks to hoard cash. Wachovia Corp., under pressure to seek a buyer, retreated 16 percent on concern suitors may wait to see whether regulators will seize the bank. Exxon Mobil Corp. and Freeport-McMoRan Copper & Gold Inc. fell as much as 2.6 percent after commodities retreated on speculation the credit crisis will exacerbate the global economic slowdown.

S&P 500 futures expiring in December sank 18, or 1.5 percent, to 1,196.50 at 10:26 a.m. in London. Dow Jones Industrial Average futures slipped 151, or 1.4 percent, to 10,996. Nasdaq-100 Index futures declined 25.50, or 1.5 percent, to 1,649.25.

``Investors are worried what will happen next, once the bailout is implemented,'' said Jonathan Ravelas, a strategist at Banco de Oro Unibank Inc. in Manila, which has more than $6 billion in trust assets under management. ``Investors who think this cleanup will take time are reducing their holdings.''

The S&P 500 is down more than 22 percent from its 2007 record as $554 billion in credit losses and writedowns caused the failures of firms including Bear Stearns Cos. and Lehman Brothers Holdings Inc. The crisis that began with subprime mortgage-linked assets has spread into the economy as jobless claims climbed to the highest since 2001 and consumer confidence plunged.

U.S. stocks tumbled the most in four months last week, with the S&P 500 losing 3.3 percent, on concern Congress wouldn't pass the rescue plan.

`Stalled' Economy

U.S. political leaders said yesterday they have reached an agreement that will allow the Treasury to purchase troubled assets from banks. It will also limit executive compensation at some participating financial institutions as well as provide guarantees to protect the government from excess losses.

The plan ``will not jump-start lending, as house prices appear likely to keep falling for some time,'' Ian Morris, chief U.S. economist at HSBC, wrote in a Sept. 26 note to clients. ``The forces of deleveraging are overwhelming, and so the credit crunch will remain over the next few quarters. As a result, the economy would be virtually stalled over the next year.''

Investor Marc Faber, who predicted the 1987 ``Black Monday'' crash, said last week the rescue package may require as much as $5 trillion.

Citigroup Slides

Citigroup lost 81 cents to $19.34 in Germany. JPMorgan slid $2.99 to $45.25.

Belgium, the Netherlands and Luxembourg invested 11.2 billion euros ($16.3 billion) in Brussels and Amsterdam-based Fortis, Belgium's largest financial-services firm, to restore confidence in the bank. Bingley, England-based Bradford & Bingley, Britain's biggest lender to landlords, was seized by the U.K. government after the credit crisis shut off funding.

Rates on three-month loans in euros were about 5.20 percent as of 8 a.m. in London, up from 5.14 percent Sept. 26, according to Patrick Jacq, a fixed-income strategist in Paris at BNP Paribas SA, France's biggest bank. Singapore's benchmark rate for three-month U.S. dollar loans rose to the highest level in eight months today. Australian funding costs held near a six-month high.

Wachovia Takeover?

Wachovia declined $1.60 to $8.40 in Germany. The Wall Street Journal reported the Charlotte, North Carolina-based bank was in advanced takeover talks with Wells Fargo & Co. Citigroup also may make a bid, the paper reported. Suitors may wait to see whether regulators will seize the bank, then buy the best assets and let the government sort out the rest, according to analysts at Goldman Sachs Group Inc. and Egan- Jones Ratings Co.

Exxon, the biggest U.S. oil company, slipped $1.38 to $79.27 in Germany. Freeport-McMoRan, the world's second-largest copper producer, lost $1.66 to $62.16.

To contact the reporter for this story: Patrick Rial in Tokyo at prial@bloomberg.net; Ian C. Sayson in Manila at isayson@bloomberg.net.

Last Updated: September 29, 2008 05:36 EDT