[BRIEFING.COM] The stock market extends its losses as respected Oppenheimer analyst Meredith Whitney gives a dour outlook for financials.  The S&P 500 at 1201.56 is very near its 52-week low of 1200.44 reached on July 15.

Whitney said that Lehman Brothers (LEH 0.18, -3.47) has a $600 billion balance sheet that needs to be liquidated swiftly, which will drive prices of assets lower across the board.  In turn, financial companies will hold assets that are not worth as much, leading to further write-downs, Whitney said.

Whitney also said that U.S. house prices are the underlying problem, and futures prices indicate a peak-to-trough decline of 33%.  However, Wachovia (WB 10.72, -3.55) is assuming a peak-to-trough decline of only 21%, yet they have 60% of their exposure, according to Whitney.  She added that Citigroup (C 14.90, -3.05) only assumes a 23% decline.