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Banks are dragging the stock market lower as worries resurface about the European debt crisis and the broker MF Global.

The Dow Jones industrial average is down 125 points, or 1.1 percent, at 12,101 shortly after the opening bell Monday.

The S&P 500 is down 17, or 1.2 percent, at 1,268. The Nasdaq is down 38, or 1.4 percent, at 2,700.

The decline comes after the Dow closed out its fifth straight week of gains, its best winning streak since January.

Bank stocks dropped sharply in early trading after the New York Federal Reserve suspended MF Global Holdings from conducting new business as a Treasury bond dealer.

Trading in MF Global stock was halted. Bank of America Corp. and Citigroup Inc. were down more than 3 percent.

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For three years now, Efrem Rone has been keeping a close eye on an Adelaide St. E. parking lot, watching for a condo sales centre to rise from the asphalt.

“I know how things work,” says Rone, 45. “If you don’t get on the list (to get into the sales centre early), the best units are gone, prices start going up and you’re stuck with the leftovers.”

His agent was getting nowhere, despite registering early to view floor plans for the 22-storey Ivory on Adelaide project. So Rone was surprised last weekend to walk past an Ivory on Adelaide sales centre bustling with activity.

“On the door was taped an ad from a Chinese newspaper with a picture of what the project would look like. Deals were being done,” says Rone. “It looked like the sales centre was open for business, but only to people of a certain ethnicity.”

Toronto’s condo market is on fire. And much of the frenzy is being fuelled by investors, many of them Asians, who are being given preferential treatment — early access to the best and cheapest units.

“It may look like discrimination, but these people have actually earned the right to be first in line. Any business will go to their best customers first,” says realtor turned condo developer Brad Lamb.

Almost 68,000 new units are now in the planning stages or under construction across the GTA as investors, a lot of them immigrants with ties to Hong Kong and mainland China, the Middle East, India, Pakistan, Russia and Brazil, look to cash in on the biggest condo boom in the world.

A record 20,729 units have been sold in the GTA as of the end of September — smashing the pre-recession record for the same period in 2007 of 17,285. An estimated 45 to 60 per cent have been snapped up by investors, with estimates closer to 90 per cent in some newer downtown condo projects.

They are looking for solid investments in a shaky world — the keys to hard assets like real estate.

“We are a tranquil island in a sea of despair,” says one of Toronto’s leading condo development consultants Barry Lyon. “If it wasn’t for the multicultural community, we would have no condo market to speak of right now in Toronto.”

Even realtors who find themselves, and their clients, with no hope of being among the first buyers in all these new glass and steel towers springing up on Toronto’s skyline understand why this is happening.

Targeting agents with strong ties to big buyers in the multicultural community — one developer calls them his “rainmaker list” — means developers can sell 70 per cent of the units in a project faster, which keeps costs down. That’s what most banks demand before they will free up loans to start construction.

The practice has paid off: In 2005, it took an average of 13 months for condo builders to sell 70 per cent of their units, says George Carras, president of RealNet Canada, which monitors building activity across the GTA.

This year, they’re hitting the threshold in just four months, largely because of their “growing sophistication” in wooing brokers who can deliver multiple investors.

Carras likens the process to Initial Public Offerings of stocks. Those willing to spend the most and not afraid of risk potentially get the biggest payback.

But some agents complain that a handful of condo builders, such as Plaza Corp., are being so aggressive at racking up early sales, it’s becoming impossible for the average buyer, looking for a home or little investment property, to get in before prices are less affordable.

It also gets tougher to find the most desirable units, such as the cheapest one-bedroom corner units high enough to have a view.

Several realtors spoke to The Star about the focus on investment buyers, but none would be named for fear of being blacklisted from getting access to any units at all, which are now essential to their livelihood.

One Asian agent who has sold numerous Plaza Corp. units, said he had to pull strings to get clients a peek at their York Harbour Club project on the Railway Lands: “I’m not part of their stable of VIP agents.”

“York Harbour Club was a little bit unfair to the public,” concedes Plaza Corp. vice-president Scott McClellan. “The (pre-sales) took off on us a little bit and we probably didn’t have as much as we wanted to have for the general public.”

By the time the public could buy, just 30 per cent of units were available.

“This isn’t new. Everybody does it,” says McLellan of what he calls his “rainmaker list” — realtors who can deliver 15 or more buyers willing to buy from floor plans, rather than wait for built units.

McLellan says all of the early buyers of Ivory on Adelaide are Canadian citizens, buying units as long-term investments or as homes for their kids or relatives who might be migrating from overseas.

No one knows how much is offshore investment.

Lyon points out that investors have become essential landlords in a city where almost no one is building apartments. He also sees the units as “warehousing” for first-time buyers who can rent while saving up a down payment. Often investors are willing to sell without requiring the 20 per cent down payment a bank demands.

“These investors bear no relationship to the speculators of the 1980s,” Lyon says. “They’re very sophisticated” and recognize Toronto as a bargain compared with other major cities in the world.

A lot of developers point out they hold back units so less high-achieving realtors, and the public, don’t miss out altogether. Often they are at higher prices — parking spots alone can be almost $10,000 more expensive — but McLellan says there are no plans to raise unit prices on Ivory on Adelaide when the public gets their first crack this weekend.

Rone is fairly savvy — he has been involved in the condo market since 2006 — but is still shaking his head: “This just seems unfair.”

He finally got his email invitation to the “grand opening” of the Ivory on Adelaide sales centre Friday. Like everyone else who may walk through the doors, he has no clue that almost half — 43.5 per cent — of the 358 units have already been sold.

McLellan insists that no buyer is being left out. Even those who’ve dropped by the last few days have been asked to leave their names.

But Rone’s agent now knows she gained nothing by registering early and that the smallest and most affordable places will likely be gone.

“I’m not going to lie and tell you that I haven’t heard this (complaints about the early sales process) before,” McLellan says. “I have people who have called me upset. We figure it out for them.

“Have him give me a call.”

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Visa Inc. says its fiscal fourth-quarter profit rose 14 percent as cardholders used their credit and debit cards more often both in the U.S. and abroad.

The San Francisco-based payments processing network says it earned $880 million, or $1.27 per share, for the three months ended Sept. 30. Revenue rose 13 percent to $2.38 billion.

Wall Street was expecting profit of $1.25 per share, on revenue of $2.4 billion fast payday loan no faxing.

Visa says it processed 13 billion transactions during the quarter, up 9 percent from last year.

Worldwide, Visa card holders spent $1.55 trillion on their cards, with debit outpacing credit. That’s up 17 percent from last year’s quarter.

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ConocoPhillips says its third-quarter profit fell about 14 percent due to unexpected production losses in China and Libya. Conoco has also been selling assets as it reshapes the company.

The Houston oil company on Wednesday reported earnings of $2.62 billion, or $1.91 per share, for the July-September quarter. That compares with $3.06 billion, or $2.05 per share, in the same part of 2010. Excluding special charges, Conoco reported adjusted earnings of $3.45 billion, or $2.52 per share.

Revenue increased 33 percent to $62.78 billion.

Analysts, who usually exclude special charges, expected earnings of $2.16 per share on revenue of $55 billion, according to FactSet.

Shares rose $1.59, about 2 percent, to $72.27 in premarket trading.

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U.S. stock futures rose Monday after Caterpillar raised its profit forecast on expectations that the economic recovery will continue and companies announced a flurry of takeovers.

Investors are still worried about Europe’s debt problems, which have helped drag global stocks up and down the last two years. European leaders said they made progress at a weekend summit, but they likely won’t unveil concrete plans to help resolve the crisis until Wednesday.

But even with the global economic worries, Caterpillar and other U.S. companies are still reporting bigger profits. “Although there is a good deal of economic and political uncertainty in the world, we are not seeing it much in our business at this point,” Caterpillar Chief Executive Doug Oberhelman said.

The maker of construction equipment said its profit rose 44 percent in the latest quarter from a year earlier. It shares rose 5 percent in premarket trading.

Caterpillar joins McDonald’s Corp. and other U.S. companies that have reported stronger third-quarter earnings. Those reports helped the Dow Jones industrial average last week to rise for the third straight week. The Standard & Poor’s 500 index finished the week at its highest level since Aug. 3, before Standard & Poor’s downgraded the U.S. credit rating on Aug. 5 and helped trigger big swings in global markets.

Analysts expect companies in the S&P 500 to report total earnings growth of 14 percent for the third quarter, according to FactSet.

Other big companies expected to report earnings results this week include UPS Inc instant credit reports., Ford Motor Co. and Procter & Gamble.

Analysts expect S&P 500 companies to say their revenue rose 10 percent last quarter. But their expenses likely climbed too. Higher costs for raw materials helped drag down profit for Kimberly-Clark Corp. by 8 percent. The maker of Huggies and Kleenex fell 1 percent in premarket trading.

A flurry of corporate deals helped lift stock futures.

RightNow Technologies Inc. rose 19 percent ahead of the bell after Oracle said it will buy the tech service company for about $1.5 billion.

HealthSpring rose 33 percent after Cigna said it will buy the health insurer for about $3.8 billion in cash.

Mattel rose 1.6 percent after it agreed to buy Hit Entertainment, the owner of the Thomas & Friends and Barney brands, for $680 million in cash.

Asian and European markets rose earlier Monday after Japan said its exports grew for a second straight month in September and a report showed China’s industrial production returned to growth in October. Japan’s Nikkei 225 index rose 1.9 percent.

Thirty minutes ahead of the opening, Dow Jones industrial average futures rose 43 points, or 0.4 percent, to 11,800. S&P 500 index futures rose 2.90, or 0.2 percent, to 1,238.10. Nasdaq 100 futures rose 8, or 0.3 percent, to 2,342.25.

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Thailand’s prime minister says the country’s catastrophic floods may take up to six weeks to recede.

Yingluck Shinawatra also said in a weekly address to the nation Saturday that the crisis had displaced more than 110,000 people from their homes.

The government said the death toll had risen to 356.

Excessive monsoon rains have drowned a third of the Southeast Asian nation since late July, and over the last two weeks the government has struggled to prevent the inundation from pouring through Bangkok.

Districts just outside the capital’s northern boundaries have been submerged for days. Since Friday, rising waters have caused minor flooding in Bangkok’s outskirts.

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Investors remain anxious to find safety even as the stock market moves back toward positive territory for the year.

They’re on pace to yank more than $20 billion out of stock funds this month, the fourth time in the last five months, scarred by the volatility over everything from the sluggish economy to Europe’s debt crisis to the threat of another global recession.

Despite the recent market uptick, there’s still plenty to worry about.

Fears remain that the Greek government may fail to pay its massive debts, which would wreak widespread financial havoc. Federal Reserve Chairman Ben Bernanke hasn’t backed off from his statement early this month that the economic recovery “is close to faltering.” And investors aren’t fully convinced that the selloff that pushed the Standard & Poor’s 500 index down 14 percent in the third quarter has run its course.

All the added uncertainty fuels any temptation to abandon stocks, as many already have done.

But “playing it safe” comes at a cost. Over the long run, fleeing to cash or buying Treasurys may be even more dangerous in this era of low interest rates as well as low returns. It can do permanent damage to your money’s buying power and your retirement prospects.

That’s the message financial advisers have been hammering home to clients who want to abandon the stock market, fearing a repeat of the 2008 meltdown or who are simply fed up with all the plunges.

Disillusioned investors, too, risk chasing an illusion of safety. So-called safe havens aren’t all that safe anymore.

“This is what I say to clients: `There is no safety’,” says Femi Shote, an investment adviser with Asset Harvest Group in McLean, Va. “What I preach is resilience, not safety.”

Hints of improvement in the latest corporate results hold out hope for investors, while highlighting the risk of being on the sidelines. Joseph LaVorgna, chief U.S. economist at Deutsche Bank, says the stock market is “pretty cheap” after all the selling and could come back quickly.

“All this volatility doesn’t engender a lot of confidence,” LaVorgna says. “But some good news can quickly restore it. If it looks like the economy is still growing and there’s some resolution in Europe, we could have the tonic for a powerful rally.”

Whether that occurs soon or not, here’s a look at the numbers confirms the meager payoffs of playing it safe.

_ Cash: Although it can provide a sense of security, cash doesn’t hold its value well over time. The average yield on a money-market account is just 0.54 percent, according to Bankrate.com. Even the best-paying online savings accounts pay 1 percent or less. As recently as the summer of 2008, just before the financial crisis hit full-force, you could earn 5 percent on such accounts.

Certificates of deposit also pay poorly. The highest rates available are 1.15 percent on a one-year CD and 2.2 percent on a five-year CD.

_ U.S. Treasury notes: The safety of bonds is less rewarding than it used to be. The yield on the benchmark 10-year Treasury fell to a record-low 1.71 percent last month and remains near 2 percent.

_ Gold: It is far too speculative to be used wisely as protection against a falling stock market. But gold has been embraced by investors worried about rising U.S. debt, the possibility of inflation and a spreading European debt crisis. More and more piled in as the price nearly tripled in four years, reaching a record $1,891.90 on Aug. 22.

Since then, it has tumbled all the way back near $1,600.

Aside from gold’s recent slide, a market-weary investor might reason that at least cash and other options offer less downside risk than stocks and the most protection for their accounts.

Investment experts, however, consider that thinking short-sighted quick cash. If you’re too conservative, they note, you can outlive your money.

Inflation historically averages about 3 percent, so putting money aside that earns less than 1 percent means its value is eroding over time. Keeping money in the stock market is the likeliest way to stay ahead of inflation, or at least keep pace.

Even in a period that included two sharp declines in the market, the S&P 500 index had an average annual return of 7 percent for the 15 years from mid-1996 through June 30. That’s hard to match elsewhere.

Investors who ditch stocks are removing future growth from their portfolios and need to compensate elsewhere.

“When you sell, you need to simultaneously increase the amount you’re contributing to that account,” says Stuart Ritter, a certified financial planner for T. Rowe Price in Baltimore. “Or if you’re in retirement, you need to withdraw less. Otherwise you have no chance to keep up with inflation.”

Then there’s what economists call the opportunity cost — what you miss out in the long haul by leaving.

Over the longer term, the case for staying in stocks is even more compelling. History says the market is highly unlikely to decline over any 10-year period, recent times notwithstanding. On a rolling basis, the S&P 500 has produced losses in only four out of 76 different 10-year periods since 1926, according to a T. Rowe Price analysis.

Those who want to keep their cash on the sidelines until the market calms down, even for a few days, do so at risk of missing a comeback. An investment that excluded the best 10 days of the S&P 500 in the past decade would have posted an annual loss of 1.5 percent rather than a gain of 5.3 percent.

Investors who sat out even part of the 2009-11 bull market learned the hard way.

When panicked clients call Joe Adkins of Financial Advisors International with a request to sell after seeing the Dow drop hundreds of points, the Orlando, Fla., money manager offers a ready reminder. Had they sold stocks in March 2009 when the market bottomed and bought back in in December 2009, he tells them, they would have missed a 4,000-point gain in the Dow — nearly two-thirds of the two-year bull-market rally.

“You shouldn’t manage your money based on the headlines,” his advice goes. “Just weather the storm, because if you go to cash you risk running out of money.”

Besides telling clients to stick with the market, many advisers are steering them toward large, stable, blue chip stocks with a history of paying annual dividends of 3 percent or more.

Others recommend sinking a small percentage of holdings into alternative investments _ a catch-all term for such instruments as hedge funds and commodities. Alternative investments can be used as a tool to reduce overall risk through diversification. But the complexity, cost and lack of liquidity typically don’t make those the safest of investments, either.

Ultimately, those who can’t tolerate short-term risk for the likelihood of long-term gains may find a comfort level with simply a smaller percentage of their money in stocks.

They just have to realize that caution will probably cost them in the end, according to Pat Dorsey, director of research and strategy for the Sanibel Captiva Trust Co. in Chicago.

“Certainly if you are just a very nervous person, prone to getting out of the market every time the Dow drops 2 or 3 percent, having higher cash or bond allocation may make sense,” Dorsey says. “But you’ve got to dial down your (lifestyle) expectations for the future if you do that.”

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Fiat and Chrysler are focusing on cash-generating businesses in the United States and Brazil to help weather growing uncertainty in the European auto market, CEO Sergio Marchionne said Wednesday.

Fiat, which took over Chrysler nearly 2 1/2 years ago, saw its credit rating downgraded this week over financial risks in its alliance with the U.S. carmaker, which has been recovering from bankruptcy. Crucially, it is under severe pressure in its home market of Italy, where unions are resisting more flexible work conditions and demand is fading.

Adding to uncertainty, the Italian government appears unable to swiftly implement the austerity and growth measures aimed at preventing the country _ Fiat’s most important market _ from being swept into a spiraling debt market crisis.

“There is no doubt that a lot of elements are coming to play here, one of which may be an Italian factor. … I don’t know any more,” Marchionne said. “The stock market is up 4, 5 percent one day, then down 3. It is totally moving on rumors. There is no factual basis. I haven’t moved a forecast. I have moved nothing.”

Marchionne has maintained 2011 forecasts of euro58 billion ($79 billion) in revenues with euro2.1 billion ($2.9 billion) in trading profit for the combined automakers.

But he said there was little he can do to calm the markets.

“It is embedding a perception of risk which is totally outside of my control for me to try to cover it. We are almost helpless on this. There is nothing I can tell you, or tell the market, that will make this go away.”

The continuing economic uncertainty is hurting auto sales, particularly in Fiat’s main Italian market. Fiat registered a 7.8 percent drop in sales last month compared with a year earlier while its European market share shrank to 6.5 percent in September from 7.2 percent a year earlier.

“It impacts consumer attitudes, and that is probably the most negative thing about all of this. It really negatively impacts moods,” he said.

To maintain profitability, Marchionne said he is focusing on the cash-making parts of the business _ the U.S. and Brazilian markets _ while trying to build sales in the increasingly competitive European market, mainly outside of Italy where sales are at 30-year lows.

“They are still today the biggest profit contributors to Fiat. They need to be nurtured,” Marchionne said of the U.S. and Brazil business card. “That’s why I spend so much time there.”

Ironically, it is Fiat’s alliance with Chrysler that triggered downgrades by ratings agencies. Fitch was the last to weigh in on Tuesday, lowering the credit rating from to BB from BB+. It cited Fiat’s “intrinsic weakness,” its heavy reliance on the Italian and Brazilian markets, and exposure to increased financial risk due to the alliance with Chrysler.

Marchionne said Fiat is in a good cash position to continue with its investments in Italy and abroad for new production. Fiat expects to have euro18 billion in liquidity at the end of this year, according to its forecasts.

“We have enough liquidity now to deal with our requirements for quite a while,” Marchionne said.

But he criticized unions in Italy that continue to challenge the new contracts with more flexible work hours that Fiat has agreed at three plants. The FIOM metalworkers union has announced a one-day strike Friday at all Fiat plants.

“I think the strike, personally, is a very bad idea. It is not the manner in which one would encourage investment in this country,” Marchionne said, adding that he believes most Fiat workers support the new contracts, which have secured new investments at two plants near Fiat’s Turin headquarters and one near Naples.

Marchionne attended Wednesday the European launch of the Lancia Voyager minivan and Thema luxury sedan, both based on Chrysler models and concrete examples of the tighter integration of the two companies. In all of Europe except Britain, Chrysler models will carry the Lancia badge.

The Thema luxury sedan is Lancia’s re-entry into the premium market, after a two-year absence, at an affordable price of euro41,400. It is based on the Chrysler 300, but has been restyled and adapted for European markets with a soft leather interior, firmer suspension and redesigned front-end.

Lancia brand chief Saad Chehab said the car is the same size as the Audi A-8, but sells at a 15 percent discount over the smaller Audi A-6.

Both the Thema and Voyager will be manufactured in Canada, and aim at the higher end of Fiat’s market, with neither expected to achieve huge volumes. Chehab said they expect to sell 10,000 Themas and 11,000 Voyagers a year.

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About 1,000 Libyan revolutionary troops have launched a major assault on Moammar Gadhafi’s hometown, surging from the east to try to capture the last area under loyalist control.

Tuesday’s push to rout the remaining resistance from Sirte came a day after commanders announced they had captured most of a second stronghold, Bani Walid.

Libyan fighters have squeezed the die-hard Gadhafi supporters into an area comprising just a few blocks in Sirte but have been unable to gain full control of the city.

It has been more than two months since the former rebels gained control of the capital and much of the rest of the oil-rich North African nation. Persistent fighting has prevented Libya’s new leaders from declaring final victory and setting a timeline for elections.

THIS IS A BREAKING NEWS UPDATE. Check back soon for further information. AP’s earlier story is below.

TRIPOLI, Libya (AP) _ Libyan revolutionary forces have captured almost all of Bani Walid, one of Moammar Gadhafi’s last remaining strongholds, but still face pockets of resistance as they try to end a weeks-long standoff, officials said Monday.

Fierce resistance in Bani Walid and Gadhafi’s hometown of Sirte has prevented Libya’s new leaders from declaring full victory and setting a timeline for elections. It has been more than two months since the former rebels gained control of the rest of the oil-rich North African nation.

In a step toward normalcy, the transitional leadership council confirmed it has signed an agreement with NATO that partially lifts the no-fly zone imposed in March over the country, allowing resumption of some flights without seeking NATO approval. The embargo was imposed as part of the U.N. Security Council resolution that authorized airstrikes to protect civilians from Gadhafi’s regime.

Anwar Elfeitori, the minister of transportation and communications, said the agreement signed Thursday in Malta will make it easier to transport wounded fighters from the front lines for treatment.

“The partial lifting of the air embargo will help with the transportation of the casualties, which is the No. 1 priority at this time, as well as facilitate the movement of people between Libya and the rest of the world,” Elfeitori told The Associated Press in an interview.

He said the agreement only applies to specific routes and altitudes for humanitarian flights but is designed so it can be amended to include other areas as security conditions allow.

In Washington, State Department spokesman Mark Toner said the revolutionary council fighters are making progress short term personal loan. He called on pro-Gadhafi forces “to lay down their weapons and join the new Libya.”

NATO officials have expressed surprise at the persistence of Gadhafi’s supporters. Libyans believe the heavy resistance signals some of Gadhafi’s sons and other high-level regime figures are hiding in the areas.

Fighters in Bani Walid, which has proven particularly hard to capture because of its difficult terrain, said they have entered the city center for the first time but still were fighting Gadhafi supporters in surrounding villages.

“We liberated the city around sunset on Sunday and raised the revolutionary flags all over the city,” field commander Abdel-Salam Genouna told The Associated Press. He said fighters had occupied the central marketplace, the hospital, the hotel and an old fort that had all been used as bases for Gadhafi loyalists.

“We are patrolling the neighborhoods because there are still some scuffles, but otherwise it is completely under our control,” he said, adding revolutionaries also had control of a steep valley called Wadi Zeitoun that had been a sniper base for Gadhafi’s forces.

“Our forces are everywhere inside the city, and we are protecting the few families we found inside,” he said.

He said fighters from Sabratha, Tripoli and Bani Walid were involved in the operation.

Col. Ahmed Bani, a military spokesman in Tripoli, said revolutionary forces had control over more than 90 percent of the city. He said revolutionary forces had suffered heavy casualties but declined to give a number.

Residents and fighters said that Gadhafi forces retreated in the face of the advance over the past two days.

Moammar al-Warfali, a doctor in Bani Walid, said fighters loyal to the new transitional government seized the center, a key hospital and several other high buildings used by Gadhafi’s snipers to prevent any advance by the revolutionary fighters.

He also said Gadhafi’s son Seif al-Islam had been seen in the city as recently as last week.

NATO has pledged to continue airstrikes for as long as necessary, saying pro-Gadhafi forces continue to pose a threat to civilians in Libya.

Britain’s Foreign Secretary William Hague also pledged more humanitarian and financial support Monday during a visit to Tripoli.

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Germany’s finance minister says private holders of Greek government bonds must accept bigger losses to achieve “a durable and sustainable solution” for Europe’s debt crisis.

Wolfgang Schaeuble told German public broadcaster ARD on Sunday that an agreement struck in July when banks and other investors agreed to renounce on 20 percent of their Greek debt must be renegotiated.

He says the private sector’s contribution to a reduction of Greece’s debt burden “will probably have to be higher fast payday loan.”

The Institute of International Finance, a global bank lobbying group, says its managing director Charles Dallara is in talks with officials from the 17-nation eurozone about the July agreement. Spokesman Frank Vogl declined to elaborate, but the group’s leadership has so far rejected accepting bigger losses.

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