Connect to share and comment
Investors got that sinking feeling again as the major U.S. markets each plunged more than 4 percent.
Investors got that sinking feeling again today as the major market indices plunged more than 4 percent.
The Dow fell 519.83 points, or 4.6 percent, to close at 10,719.94. The S&P index dropped 51.77 points, or 4.42 percent, to 1,120.76. And the NASDAQ lost 101.47 points, or 4.09 percent, ending at 2,381.05.
The last time there were three consecutive days of 4 percent moves on the S&P was in October 2007, the New York Times reports.
On Monday, the first trading day after Standard & Poor’s downgraded the United States’ AAA credit rating, the Dow fell more than 630 points. On Tuesday, in response to the U.S. Federal Reserve’s announcement that it would keep interest rates low until the middle of 2013, the markets recovered some, with the Dow gaining 429.62 points. Wednesday's slide erased those gains, Reuters reports.
The sell-off appeared to be driven by two main concerns. First, after mulling over Tuesday’s interest rates announcement overnight, investors seemed discouraged that the reason the Fed is keeping rates low is because it believes there is little chance the economy will improve substantially by 2013. Second, the Euro zone debt crisis and new fears that France will lose its AAA credit rating are making investors jittery, Reuters reports.
The day saw big swings in trading, with the Dow falling more than 300 points within the first minutes, then climbing up again.
(More from GlobalPost: Wall Street slides in early trading)
The slumping markets are impacting the business community, according to the Associated Press:
Stocks have fallen so far that six companies have withdrawn plans this week to sell stock on U.S. markets for the first time, according to Dealogic. That brings the number of withdrawn initial public offerings, or IPOs, to 65 so far this year. That is the most through this point in the year since 2001.
European markets also ended lower on Wednesday. Britain’s FTSE 100 lost 157.76 points, or 3.05 percent, to close at 5,007.16. Germany’s DAX fell 303.66, or 5.13 percent, to close at 5,613.42. France’s CAC 40 dropped 173.20, or 5.45 percent, to finish at 3,002.99.