Citigroup (C) shares are in a free fall in pre-market, diving about 45% after the U.S. government did a deal to convert $25 billion of its preferred stock in the beleaguered bank to common stock, giving it a stake of up to 36 percent in the bank.

Other banks are dropping on Citi news: Bank of America (BAC) skidded 21 percent and JPMorgan (JPM) slid 6 percent in pre-market trading.

In Europe, too, banks are slumping. Lloyds Banking Group's (LYG) U.S. shares meanwhile plunged 20 percent as it didn't reach an agreement with the U.K. government to insure assets. Lloyds reported Friday that profits shrank to 819 million pounds in its Lloyds TSB unit in 2008, while the recently acquired Halifax/Bank of Scotland lost 7.5 billion pounds ($10.6 billion) over the year. Meanwhile, Royal Bank of Scotland Group (RBS), which did reach a deal with the U.K. government Thursday, also saw its shares dropped more than 14 percent.

Dell (DELL) reported a worse-than-forecast fourth-quarter profit of 18 cents a share, quite below the expected 26 cents a share. The company also hiked its cost reduction target to $4 billion from $3 billion. Dell shares traded slightly higher in early pre-market action.

Ford Motor (F) will reopen a plant in Cleveland that has been retooled to build more energy-efficient engines. The move will create 250 jobs. Ford shares are down 5% in pre-market trade.

Gap (GPS) reported a 12 percent profit fall, as same-store sales fell 14 percent in the quarter. But Gap also said it is cutting costs, reducing inventories, and closing stores. Results beat analyst estimates. GPS shares are down 4.4 percent in pre-market trade.

Kohl's Corp. (KSS) reported a sharp drop in fourth-quarter profit on sluggish sales after the close Thursday. Same-store sales declined 9.1 percent, but results beat estimates. KSS shares are slumping over 6% in pre-market trade.

Novell Inc. (NOVL) reported its adjusted first-quarter net income fell to 7 cents a share, a penny better than estimates. NOVL shares climbed 3% in after-hours trade.

Sony Corp (SNE) announced its Chairman and CEO Howard Stringer will also take on the role of president, as part of a management shakeup.

Blackstone (BX) and Interpublic Group of Companies (IPG) are among companies reporting earnings today.

Ruths Chris Steak House (RUTH) is also scheduled to report results today. It will be interesting to see the results to recent news that meet producers have huge losses as Americans are eating more hamburgers and fewer steaks. Each week $100 million is lost as feedyards sell beef at a loss. RUTH shares are climbing about 5.5% in pre-market trade after it reported a surprise fourth-quarter profit.

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