Investor despair sends stocks plunging

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NEW YORK --- Stocks and interest rates fell sharply Wednesday as more bad news chipped away at investors' view of the economy.

The Dow Jones industrial average fell 265 points, and all the major indexes fell more than 2 percent and are now showing losses for the year. The Dow has fallen four days out of five, and it has lost almost 320 points in just the past two days.

Meanwhile, the yield on the Treasury's 10-year note fell to its lowest level since March 2009 as investors avoided stocks and sought the safety of government securities.

Only 442 stocks rose on the New York Stock Exchange, while 2,627 fell, a sign that investors expect all businesses to suffer if the economy continues to weaken.

Investors' gloom deepened a day after the Federal Reserve said it would begin buying government bonds as a way to stimulate the economy. News of slower industrial growth in China and a disappointing economic indicator in Japan helped send stocks plunging in Asia, then in Europe.

The economic news in the U.S. was also troubling. The Commerce Department said the trade deficit widened in June to its highest level in 20 months as exports dipped. Falling exports mean U.S. manufacturing could be slowing down.

Stock traders tend to buy and sell based on their expectations for what business will be like in six to nine months. The problem is that economic data have been so muddled lately that investors have no sense of whether the recovery will hold. In its economic assessment statement Tuesday, the Fed was still talking about a recovery, although the central bank said it would be more modest than forecast in June.

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carcraft
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carcraft 08/12/10 - 04:16 am
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Joe Biden's "summer of

Joe Biden's "summer of recovery" LOL

esmc68
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esmc68 08/12/10 - 08:02 pm
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Its going to get worse. Much,

Its going to get worse. Much, Much worse. Sing along now.. Barak Hussein Ohama Mmm, Mmm, Mmm....

esmc68
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esmc68 08/12/10 - 08:04 pm
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At what point will the state

At what point will the state controlled media stop lying to us about the "recovery". What freaking recovery. Bunch of Obama worshipping idiots!

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