Dow's 778-Point Tailspin Is Bigger Loss Than First Trading Day After 2001 Attacks
|
TOOLBOX
   Resize
COMMENT
 Discussion Policy
 CLOSE
Comments that include profanity or personal attacks or other inappropriate comments or material will be removed from the site. Additionally, entries that are unsigned or contain "signatures" by someone other than the actual author will be removed. Finally, we will take steps to block users who violate any of our posting standards, terms of use or privacy policies or any other policies governing this site. Please review the full rules governing commentaries and discussions. You are fully responsible for the content that you post.
Who's Blogging  |
Tuesday, September 30, 2008
NEW YORK, Sept. 29 -- The government's financial bailout plan failed in Congress on Monday, and stocks plunged precipitously, hurtling the Dow Jones industrial average down nearly 780 points in its largest one-day point drop ever. Credit markets froze further as fears spread that the economy was headed into a growing credit and economic crisis.
The Dow fell 777.68, or 6.98 percent, to 10,365.45. The decline surpassed the record 721.56-point intraday drop on the first trading day after the 2001 terrorist attacks. Still, in percentage terms, Monday's decline remained well below the more than 20 percent drops seen on Black Monday of October 1987 and during the Depression.
The Standard & Poor's 500-stock index declined 106.62, or 8.79 percent, to 1106.39. The Nasdaq composite index fell 199.61, or 9.14 percent, to 1983.73.
At the New York Stock Exchange, stunned traders -- faces tense and mouths agape -- watched on TV as the House voted down the plan in mid-afternoon. Activity on the floor became frenetic as the "sell" orders blew in.
The Dow told the story of the market's despair, with the blue chips dropping hundreds of points in mere moments. The selling was so intense that only 162 stocks rose on the NYSE -- and 3,073 dropped.
Word came before trading began that Wachovia, one of the biggest banks to struggle with rising mortgage losses, was being rescued in a buyout by Citigroup. It followed the recent failure of Lehman Brothers and the forced sales of Merrill Lynch, Bear Stearns and Washington Mutual; all of them were felled by bad mortgage investments. And it raised the question: Which banks are next, and how many?
Wall Street is contending with all these issues against the backdrop of a credit market -- where bonds and loans are bought and sold -- that is barely functioning because of fears that anyone lending money will never be paid back.
Investors stashed money in the Treasury's 3-month bill Monday, willing to take the tiniest of returns simply to be sure that their principal would survive in what's considered the safest investment. The yield on the 3-month bill was 0.15 percent.
Light, sweet crude fell $10.52, to settle at $96.37 a barrel on the New York Mercantile Exchange, where gold rose $5.30, to $888.20.
