Washington - US stock markets Monday opened slightly down after a week of turmoil as investors await the outcome of the US government's proposed
700-billion-dollar government bailout of bad mortgage debt that would be an unprecedented intervention in capital markets.

At the opening bell, the Dow Jones index of blue chips was down more than 50 points, or about half a percent, at 11,337. The broad- based S&P 500 was also down more than half a percent, or 5 points, to 1,249.

The market opened as Mitsubishi UFJ Financial Group Inc, Japan's largest bank, agreed to invest up to 8.4 billion dollars for up to one-fifth of Morgan Stanley.

On Sunday, the US investment firm agreed to convert its operation to a bank holding company and submit to more government regulations.

Mitsubishi UFJ said it would buy 10 per cent to 20 per cent of Morgan Stanley, the bank said in a statement quoted by Bloomberg financial news service.

Last week, Mitsubishi UFJ Chairman Ryosuke Tamakoshi said the bank would avoid any immediate investments in US banks amidst turmoil in the US finance industry.

Also last week, two other investment firms disappeared. Lehman Brothers declared bankruptcy and Merrill Lynch was swallowed by Bank of America. Earlier this year, Bear Stearns was bought by JP Morgan Chase.

On Sunday, Morgan Stanley along with Goldman Sachs, the last two investment banks standing after the crushing failures of high-risk mortgage debt securities, asked the Federal Reserve for conversion to bank holding companies. The conversion would subject the firms to strict government regulations.

The Fed has approved the move, pending approval by antitrust authorities. The move marks the end of high-flying finance on Wall Street that boosted profits and executive salaries to unprecedented heights over the past two decades.

The urgent 700-billion-dollar bailout programme would be a system-wide purchase of bad mortgage assets from all troubled financial firms by the US government to thaw out the current credit freeze.

Congressional approval is expected this week, but majority Democrats may insist on more guarantees for taxpayers and on putting limits on executive salaries in firms that benefit from the purchases. (dpa)