WASHINGTON (AP) -- Banks borrowed in record amounts from the Federal Reserve's emergency lending facility over the past week, while investment banks drew loans at a brisk -- though slightly lower -- pace, fresh proof of the credit problems gripping the country.

The Fed's report released Thursday said commercial banks averaged a record $75 billion in daily borrowing over the past week. That surpassed the old record -- a daily average of $44.5 billion -- logged in the previous week. On Wednesday alone, $98 billion was drawn, an all-time high.

For the week ending Wednesday, investment firms drew $134 billion. That was down from a record $147.7 billion in the previous week. This category was broadened last week to include any loans that were made to the U.S. and London-based broker-dealer subsidiaries of Goldman Sachs, Morgan Stanley and Merrill Lynch.

The Fed report also showed that over the last week $145.9 billion worth of loans were made to money market mutual funds -- via banks -- to help the funds, which have been under pressure as skittish investors demand withdrawals.

Squeezed banks and investment firms are borrowing from the Fed because they can't get money elsewhere. Skittish investors have cut them off, moving their money into safer Treasury securities. Financial institutions are hoarding whatever cash they have, rather than lend it to each other or customers.

The report also showed that the Fed has loaned $70.3 billion to insurance giant American International Group. In mid-September, the Fed said it would provide the troubled company a two-year, $85 billion

NEW YORK (AP) -- Shares of General Motors Corp. lost nearly one-third of their value Thursday, plunging to their lowest level in more than 58 years after Standard & Poor's said the automaker's credit could fall further into junk status due to the "rapidly weakening state" of the global automotive market.

GM shares plummeted $2.15, or 31.1 percent, to close at $4.76 after falling as low as $4.65. That low marked the automaker's lowest trade since March 15, 1950, according to the Center for Research in Security Prices at the University of Chicago. At that time, the Korean War was three months away from beginning, and gasoline cost 27 cents a gallon.

Thursday marked the sixth straight day of losses for GM. The automaker's shares are down 50 percent from their close of $9.45 at the end of last month.

Brett Hoselton, an analyst who follows GM stock for KeyBanc Capital Markets, said a number of factors could be behind Thursday's drop, including the decline in banking stocks.

"Obviously, GM and Ford, they're closely tied to automotive financing," Hoselton said. "If you can't finance cars, you can't sell cars."

In addition, the three-week ban on short selling some stocks -- including GM's -- expired late Wednesday. Short selling involves borrowing a company's shares, selling them, and then buying them back when the stock falls and returning them to the lender. The practice allows investors to profit from the decline in a stock's value.

Dave Healy, analyst for Burnham Securities, said it's possible that the expiration of the short-sell ban hurt

NEW YORK (AP) -- Citigroup backed out of negotiations with federal regulators and Wells Fargo in its battle for Wachovia Corp., but vowed to have its day in court.

Citigroup said it remains willing to complete its original deal with the Charlotte, N.C.-based bank. However, while it is seeking damages for breach of contract, it has decided not to challenge the Wells Fargo-Wachovia deal in court. That stance paves the way for Wells Fargo to close its $11.7 billion stock deal.

"We're pleased Citigroup has abandoned its efforts to interfere with Wachovia's planned merger with Wells Fargo," said Wachovia spokeswoman Christy Phillips-Brown in an e-mail to The Associated Press. "We look forward to completing our merger with Wells Fargo, which we have always believed is in the best interest of shareholders, employees, creditors and retirees as well as the American taxpayers, and it imposes no risk to the FDIC fund."

New York-based Citigroup said it believes it has strong legal claims against Wachovia, Wells Fargo, and their officers and directors for breach of contract and plans to pursue its claims "vigorously."

Citigroup came to the rescue of an ailing Wachovia when it agreed last Monday to buy Wachovia's banking operations for $2.1 billion in a deal brokered by the Federal Deposit Insurance Corp.

Slammed over the past year by defaulting mortgages, Wachovia was in considerable trouble. Wachovia disclosed in court documents that it agreed to the acquisition "with the understanding that a seizure of its banking assets later that day by the Federal Deposit Insurance Corp. would occur" unless it accepted Citigroup's proposal.

Four days later, San Francisco-based Wells Fargo stunned Citigroup by announcing that Wachovia's board

NEW YORK (AP) -- Stocks plunged Thursday, sending the Dow Jones industrial average down 679 points -- more than 7 percent -- to its lowest level in five years. Stocks took a nosedive after a major credit-rating agency said it might cut its rating on General Motors and Ford, further rattling investors already fretting over the impact of tight credit on the economy.

The Standard & Poor's 500 index also fell more than 7 percent.

The declines came on the one-year anniversary of the closing highs of the Dow and the S&P. The Dow has lost 5,585 points, or 39.4 percent, since closing at 14,164.53 on Oct. 9, 2007. It's the worst run for the Dow since the nearly two-year bear market that ended in December 1974 when the Dow lost 45 percent. The S&P 500, meanwhile, is off 655 points, or 41.9 percent, since recording its high of 1,565.15.

U.S. stock market paper losses totaled $872 billion Thursday and the value of shares over all has tumbled a stunning $8.33 trillion since last year's high. That's based on figures measured by the Dow Jones Wilshire 5000 Composite Index, which tracks 5,000 U.S.-based companies' stocks and represents almost all stocks traded in America.

Thursday's sell-off came as Standard & Poor's Ratings Services put General Motors Corp. and its finance affiliate GMAC LLC under review to see if its rating should be cut. The action means there is a 50 percent chance that S&P will lower GM's and GMAC's ratings in the next three months. GM has been struggling with weak car sales in North America.

S&P also put Ford Motor Co. on credit watch negative. The ratings agency said that GM and Ford have