brownindian
Sixth Man
- Joined
- Nov 24, 2010
- Messages
- 4,542
- Reaction score
- 1,615
- Points
- 113
NEW YORK (CNNMoney) -- In their single worst day since the 2008 financial crisis, stocks plunged Thursday, with the Dow tumbling 512 points, as fear about the global economy spooked investors.
"The conventional wisdom on Wall Street was that the economy was growing -- that the worst was behind us," said Peter Schiff, president of Euro Pacific Capital. "Now what people are realizing is the stimulus didn't work, and we may be headed back to recession."
U.S. markets were already sharply lower on widespread worries, including the weak job market. But the selling gained momentum as Japanese and European policymakers stepped in with dramatic measures to shore up their financial markets.
There's "total fear" in the market, said Bob Doll, chief equity strategist at the world's largest money manager, BlackRock.
All three major indexes tumbled more than 4% Thursday and erased all their gains for the year. The indexes have also pushed into 'correction' territory - defined as a 10% drop from recent highs. The Dow, Nasdaq and S&P 500 are down more than 10% from mid-July.
"In the last two weeks, we've been through the ringer," said Rich Ilczyszyn, market strategist with futures broker Lind-Waldock. "When we start looking at the recovery, there's nothing to hang our hats on anymore."
The market's fear gauge -- the VIX (VIX) -- surged 30% to a reading of 30.5. That's just above 30 -- the level that signals a high degree of fear. The VIX up 77% from the start of the year.
At the closing bell, the Dow Jones industrial average (INDU) was down 512 points, or 4.3%, with Alcoa (AA, Fortune 500), Caterpillar (CAT, Fortune 500) and Bank of America (BAC, Fortune 500) among the biggest drags on the blue chip index. Thursday's sell-off marked the ninth biggest point loss for the Dow.
Adding further to investors' jitters, Wall Street is waiting for Friday's jobs report, which BlackRock's Doll said was adding to the selling pressure.
The report is now a bit of wild card after it has come in far below forecasts for the last two months.
Economists surveyed by CNNMoney are expecting the report to show that the U.S. economy created 75,000 jobs in July, marking a slight improvement over the paltry 18,000 jobs added in June.
The unemployment rate is expected to hold steady at 9.2%.
"The conventional wisdom on Wall Street was that the economy was growing -- that the worst was behind us," said Peter Schiff, president of Euro Pacific Capital. "Now what people are realizing is the stimulus didn't work, and we may be headed back to recession."
U.S. markets were already sharply lower on widespread worries, including the weak job market. But the selling gained momentum as Japanese and European policymakers stepped in with dramatic measures to shore up their financial markets.
There's "total fear" in the market, said Bob Doll, chief equity strategist at the world's largest money manager, BlackRock.
All three major indexes tumbled more than 4% Thursday and erased all their gains for the year. The indexes have also pushed into 'correction' territory - defined as a 10% drop from recent highs. The Dow, Nasdaq and S&P 500 are down more than 10% from mid-July.
"In the last two weeks, we've been through the ringer," said Rich Ilczyszyn, market strategist with futures broker Lind-Waldock. "When we start looking at the recovery, there's nothing to hang our hats on anymore."
The market's fear gauge -- the VIX (VIX) -- surged 30% to a reading of 30.5. That's just above 30 -- the level that signals a high degree of fear. The VIX up 77% from the start of the year.
At the closing bell, the Dow Jones industrial average (INDU) was down 512 points, or 4.3%, with Alcoa (AA, Fortune 500), Caterpillar (CAT, Fortune 500) and Bank of America (BAC, Fortune 500) among the biggest drags on the blue chip index. Thursday's sell-off marked the ninth biggest point loss for the Dow.
Adding further to investors' jitters, Wall Street is waiting for Friday's jobs report, which BlackRock's Doll said was adding to the selling pressure.
The report is now a bit of wild card after it has come in far below forecasts for the last two months.
Economists surveyed by CNNMoney are expecting the report to show that the U.S. economy created 75,000 jobs in July, marking a slight improvement over the paltry 18,000 jobs added in June.
The unemployment rate is expected to hold steady at 9.2%.
