Citigroup Inc.'s stock quickly reversed premarket gains after the market opened, falling as much as 24% Friday to a new 15-year low.
Citigroup shares recently changed hands at $3.85, down 18%. Earlier, shares fell as low as $3.57, a level the shares haven't seen since 1993.
Citigroup shares had been up as much as 10% premarket on a report in The Wall Street Journal that said the banking giant may put itself or pieces of the company on the block. The stock closed down 26% on Thursday, its worst one-day percentage decline ever.
According to the Journal story, Citi is holding a board meeting Friday to discuss whether to sell all or part of itself.
But CNBC's Charlie Gasparino reported Friday that Citi won't be selling its Smith Barney brokerage unit, citing a morning conference call between Citi's chief executive, Vikram Pandit, and staff. Pandit, according to CNBC, also decried the impact of rumors on the company and said the financial giant's capital position is strong.
"I think the market clearly wants Citi to do something a little more drastic than what they've already done," Malcolm Polley, chief investment officer at Stewart Capital Advisors in Indiana, said in an interview Friday morning.
In a note to clients, Ladenburg Thalmann analyst Dick Bove said he has received "numerous calls" asking if Citigroup is about to fail, but he sees "no reason why this should happen."
"It would take a Depression every bit as large and long as the 1930s debacle to shake this company's viability," Bove wrote of Citigroup in the note. He added, "the current decline in the stock price is reflecting a series of fears related to loans and security values that cannot be actualized without a severe setback in the economy and a very rapid increase in interest rates."
Investors have dumped bank stocks en masse on fears that economic woes will batter financial companies worse than previously expected. Weighing down the shares has been the Treasury Department's decision last week not to buy troubled assets from banks. Citigroup's balance sheet includes battered securities and loans that many investors hoped could be offloaded to the government.
