By Renae Merle, Michael A. Fletcher and Neil Irwin
Washington Post Staff Writers
Friday, October 10, 2008; Page A01
Fear and foreboding took hold on Wall Street yesterday, as the stock market again plunged and investors became convinced that the nation is on the verge of a deep and prolonged recession. The rout continued in Japan, where stocks plummeted in early trading today.
The government took steps toward an extraordinary public investment in U.S. banks, and General Motors stock fell to its lowest price since 1950 on fears it will not be able to weather the downturn. Share prices fell across every industry and for each of the 30 stocks in the Dow Jones industrial average, which was down 679 points, or 7.3 percent, to 8579.19.
But the plummeting stock market could not be blamed on any single piece of horrible news — there were no additional bank failures or government bailouts or corporate bankruptcies.
“I’ve never seen a panic like this,” said David Wyss, chief economist at Standard & Poor’s. “I’ve seen stock market drops, but not an overall panic.”
The broad Standard & Poor’s 500-stock index fell 7.6 percent, the seventh consecutive day of misery on Wall Street. The index has now fallen 42 percent from its all-time high one year ago yesterday and 22 percent this month alone. Stocks are on track for their worst calendar year since 1937.
Fear from Wall Street flooded Asia today, where markets were sharply lower in early trading. Japan’s benchmark Nikkei average plunged more than 10 percent in the morning session, while Australian markets slid more than 7 percent and South Korean stocks fell as much as 8 percent.
“It’s a domino effect. Stocks are falling out of bed. There is distrust in the market and distrust in the government that is trying to heal this,” said Peter Cardillo, chief market economist with New York-based Avalon Partners.
Read the rest:
http://www.washingtonpost.com/w
p-dyn/content/article/2008/10/0
9/AR2008100901205.html?hpid=topnews
