Dow plunges again
Wall Street extended its losses today, a day after an inflation scare sent the Dow Jones industrial average on its biggest one-day drop in three years and put the Nasdaq composite index in the red for 2006.
Stocks drifted in a narrow range through most of the session but took a sharp turn lower in the last hour of trading, a reflection of how nervous the market remained after the Dow’s 214-point dive on Wednesday.
Even economic news that showed a moderating US economy had little impact on trading, including an unexpected drop in the Conference Board’s index of leading indicators and an upswing in jobless claims.
The catalyst for the previous day’s frenzied selling was a stronger-than-forecast jump in consumer prices that ignited concerns that the Federal Reserve might keep boosting interest rates.
“This market is just scared right now,” said Ryan Larson, an equity trader at Voyageur Asset Management. ”People are taking money off the table and no bets are being made because no one knows what to do right now.”
A fresh rise in oil prices added to Wall Street’s inflation troubles and overshadowed a recovery in the bond market and a stabilising US dollar after its recent tumble against the Japanese yen.
The Dow dropped 77.32, or 0.69%, to 11,128.29. On Wednesday, the Dow had its worst session since sinking 307 points on March 24, 2003.
Broader stock indicators also declined. The Standard & Poor’s 500 index lost 8.51, or 0.67%, to 1,261.81, and the Nasdaq sank 15.48, or 0.7%, to 2,180.32.
