Dow plunges nearly 430 to fall below 8,000 mark
Wednesday November 19, 4:48 pm ET
By Joe Bel Bruno and Sara Lepro, AP Business Writers
Dow falls below the 8,000 mark as the fate of Detroit's Big Three automakers
hangs in balance NEW YORK (AP) -- Wall Street hit levels not
seen since 2003 on Wednesday, with the Dow Jones industrial average
plunging below the 8,000 mark as the fate of Detroit's Big Three
automakers amid a slumping economy disheartened investors.
A cascade of selling occurred in the final minutes of the session as
investors yanked money out of the market. For many, the real fear is
that the recession might be even more protracted if Capitol Hill is
unable to bail out the troubled auto industry.
Investors also
scoured economic data that included minutes from the last meeting of
the Federal Reserve in which policymakers lowered projections for
economic activity this year and next. Economic worries caused
across-the-board selling, with financial stocks particularly hard hit.
The
S&P 500, widely considered the broadest snapshot of corporate
America, slipped 6.12 percent to 806.58; and the Dow gave up 5.07
percent to 7,997.28. Both closed at their lowest levels since March
2003.
The financial crisis has already wiped out $6.69 trillion
of value from the S&P 500 since its October 2007 high, and many
fear more is to come. Stocks have traded with high volatility in the
past few months, with the major indexes soaring only to plunge an hour
later as the market looks for a bottom.
"I don't know what the
catalyst is going to be where we turn the corner and people start
buying stocks wholeheartedly again," said Jon Biele, head of capital
markets at Cowen & Co. "People got out of the way. The financial
situation hasn't changed."
The selling on the New York Stock
Exchange was staggering -- only 158 companies that trade there finished
the day positive while 2,943 declined. Volume again was light, a
symptom of the market's recent volatility, with 1.63 million shares
exchanging hands by the close.
Smaller stocks also got clobbered. The Russell 2000 index gave up 35.13, or
7.85 percent, to 412.38.
