Bombs in London and a bombshell economic announcement from China blew the stock market off course today.

The markets opened lower following China's announcement that after years of fixing the value of its currency, the yuan, it will now let the markets influence how much its money is worth compared to other currencies.

The news of the London bombings also weakened stocks. The market struggled back to break-even at mid-day, but slipped again in afternoon trading.

The Dow Jones industrial average fell 61 points to 10,627.77.

The Nasdaq Stock Market composite index lost 10 points, closing at 2,178.60.

The Standard & Poor's 500 stock index dropped eight points to 1,227.04.

Wal-Mart, the nation's biggest retailer, was one of the first stocks hit by China's announcement that it would no long link the value of its currency to the U.S. dollar. In the future, the value of the yuan will be allowed to float up and down -- within limits.

The Chinese currency immediately gained about 2 percent -- which may be only the beginning. The U.S. government and American companies have been complaining for years that China keeps the value of its currency artificially low, making Chinese goods exceptionally cheap to buy and import.

Investors focused on Wal-Mart because it is the biggest retailer of Chinese-manufactured goods, including electronics and clothing. Shares of Target stores, The Gap and Federated Department Stores -- parent of Bloomingdale's and Macy's -- also slipped as speculators predicted they will have to raise prices of some Chinese products.

Interest rates on government bonds rose in reaction. China is the biggest buyer of U.S. bonds and may buy less in the future, traders speculated.