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Wall Street Takes Another Dive

August 18, 2011

Stocks were in free fall on Thursday after a regional manufacturing report added to already gloomy sentiment on Wall Street, sending traders fleeing equities and into safe-haven assets like gold and Treasury bonds, which rallied.

Today’s Markets

As of 10:18 a.m ET, the Dow Jones Industrial Average plummeted 437 points, or 3.9%, to 10,969, the S&P 500 slid 48.8 points, or 4.1%, to 1,145 and the Nasdaq Composite tumbled 114 points, or 4.6%, to 2,397. The FOX 50 plunged 31.5 points to 830.

While every major sector was deep in the red, financials like Citigroup (C: 27.35, -2.50, -8.38%) and energy companies like Chevron (CVX: 92.74, -4.94, -5.06%) took strongest beating in early trading. Utilities like Duke Energy (DUK: 18.21, -0.26, -1.42%) were spared the brunt of the intense selling. In fact, 97% of the volume on the New York Stock Exchange is in declining shares.

In a sign of the uncertainty in the markets, safe-haven assets rallied in early trading. Gold — which hit a record high in the previous session — jumped $22.80, or 1.3%, to $1,817 a troy ounce. The benchmark 10-year treasury rallied, with the price soaring over $100, and the yield slumping to an all-time low below 2%.

Volatility was quite high on the day. Indeed, the VIX, often referred to as a gauge of fear, spiked 33%.

The economy has come squarely back into focus with a heavy stream of economic data released on Thursday. Morgan Stanley also warned the global economy is “dangerously close to a recession” and cut its global economic growth outlook significantly. Goldman Sachs also pared back its forecast of economic growth.


From → News

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