Articles

Economic Freefall

In economics/money on October 9, 2008 by Editor Z

Thursday, stocks sank, including the Dow Jones Industrial, which fell by 7% and lost about 678.91 points. It closed at 87.73, the lowest since May of 2003. One of the worst trading days in nearly sixty years. Everyone is wondering have we hit the bottom? Or will it get worse?

New York Times:

Stocks fell sharply in late afternoon trading in New York on Thursday as concerns about the global financial system mounted and investors priced in a deep recession.

The Standard & Poor’s 500 stock index was down nearly 7.6 percent and the Dow Jones industrial average was down 678.91 points, or about 7.3 percent, both posting one of their worst days in post-war history. The Nasdaq composite was down 5.4 percent.

Wells Fargo, Morgan Stanley and other bank stocks were among the biggest losers and the financial sector as a whole was down nearly 11 percent in late afternoon trading. But the major indexes were also pulled down by big drops in stocks like Exxon Mobil, General Electric and Chevron.

The sell-off suggests investors are pricing in a much deeper recession than the markets had previously thought was likely. New data released on Thursday also showed that retail investors were withdrawing tens of billions of dollars from stock mutual funds — a sign that the panic on Wall Street was spreading.


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