US STOCKS-Market set to fall on oil price, financials

NEW YORK, May 6 (Reuters) - U.S. stock index futures fell on Tuesday as oil prices hovered around $120, keeping pressure on consumers and energy-dependent industries, and Fannie Mae reported a big loss, underscoring the troubles in the U.S. housing and credit markets.

Fannie, the largest provider of U.S. home financing, reported its third straight quarterly loss and said it would lower its common stock dividend as it sees, significant credit losses stretching into 2009.

Fannie shares fell 5.8 percent at $26.66 before the open. Shares of Freddie Mac, Fannie's smaller counterpart, were down 4.7 percent at $24.33.

Further weighing on financial shares, money manager Legg Mason Inc posted a quarterly loss and Swiss bank UBS said it will cut 5,500 employees.

Banking stocks were already rattled on Monday by doubts about Bank of America's takeover of troubled mortgage lender Countrywide Financial Corp .

"There's a real macro concern for the financials as a whole," said Weston Boone, vice president for listed trading at Stifel Nicolaus Capital Markets in Baltimore.

"The consumer is feeling less wealthy with the deterioration of housing prices and increases in costs of food and gas, and these large institutions are all levered to the consumer with home equity loans, auto loans, credit cards."

D.R. Horton Inc , the No.1 U.S. home builder, posted a large quarterly loss on lower land values, its inventory of unsold homes and aggressive price cuts to attract buyers. D.R. Horton shares fell 5.1 percent to $15.16.

Energy shares may extend Monday's gains after Anadarko Petroleum posted better-than-expected earnings late on Monday that sent shares of the oil and gas company higher in after-hours trading.

Crude oil futures were up 9 cents at $120.06 per barrel after hitting a record of $120.93 earlier .

"With nothing major out there in terms of data, people will be talking about the inflationary power of oil," Hogan said.

S&P 500 futures were down 6.9 points, below fair value, a mathematical formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract.

Dow Jones industrial average futures fell 56 points, and Nasdaq 100 futures declined 8.5 points.

On Monday, the Dow Jones industrial average finished down 88.66 points, or 0.68 percent, at 12,969.54. The Standard & Poor's 500 Index shed 6.41 points, or 0.45 percent, to 1,407.49. The Nasdaq Composite Index lost 12.87 points, or 0.52 percent, to 2,464.12. (Editing by Kenneth Barry)

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