US STOCKS-Financials hit Wall Street after Freddie loss

* Freddie Mac posts loss, to slash dividend

* Oil edges up but still below $120/bbl

* Cisco rises on comments about outlook

* U.S. weekly energy inventories data on tap

* Dow off 0.6 pct, S&P down 0.6 pct, Nasdaq off 0.4 pct (Updates to early morning)

By Ellis Mnyandu

NEW YORK, Aug 6 (Reuters) - U.S. stocks fell on Wednesday, led lower by financial shares after home finance company Freddie Mac (FRE.N) posted its fourth straight quarterly loss and braced for more fallout from the housing slump.

Freddie Mac's weaker-than-expected loss dealt investors a blow a day after Wall Street had its biggest one day advance in four months.

Freddie Mac said it was setting aside twice as much money for bad loans and made plans to slash its dividend by at least 80 percent. For details, see [ID:nN06429838]. Its shares fell 16 percent, while bigger rival Fannie Mae (FNM.N) declined 12 percent.