S&P 500 Plunges 9%, Nasdaq Dives 8.5%

123jump.com Staff
15 Oct, 2008
New York City

Investors are increasingly betting that Secretary Paulson led bailout plan is not going to prevent the U.S. from slipping into a recession. September retail sales decline drove market averages to plunge more than 8%. Of the S&P 500 index, 9 dived more than 20%, 224 declined 10% or more and 495 fell.

4:30PM New York, 10:30AM Frankfurt, 6:30AM Sydney[R]– Growing worries of economic recession, the U.S. government failure in containing housing market collapse and weak consumer confidence dragged markets around the world. U.S. indexes dived the most since 1987.[/R]

Global Markets

Investors are increasingly worried that haphazard U.S. Treasury Secretary Henry Paulson actions and weak consumer sentiment will drag the U.S. economy into a recession. The fear was palpable as 495 stocks in S&P 500 index stocks declined. Nearly 225 stocks lost more than 10% and 9 plunged more than 20%. Investors looking for a cover bid up the long term bonds. The economic worries dragged crude oil price to $75 a barrel and prices of copper, nickel, and zinc declined more than 4%.

September U.S. retail sales declined from August and from the previous year as consumers pull back. Auto, furniture, restaurant and apparel retail sales were down more than expected in the month. Sales at convenience stores and healthcare outlets were up.

Mining and metals and energy complex stocks dropped after the crude oil, gasoline and natural gas prices fell to a low for the year. BHP Billiton, Rio Tinto and Xstrata, U.S. Steel and ArcelorMittal plunged.

Coca-Cola Company edged higher after reporting better than expected earnings a day after PepsiCo said earnings fell 9%. State Street fell after it reported 33% increase in earnings but also unrealized losses in the investments soared 65% to $3.3 billion.

UK stocks plunged after the markets in Europe fell more than 5%. Weak metals and commodities prices, a decline of 5% in crude oil futures and a rise in unemployment dragged the benchmark index down 7.2%. The copper miner, Antofagasta and BHP Billiton plunged 15%.

North American Markets

Dow Jones Industrial Average plunged 733.08 or 7.9% to a close of 8,577.91, S&P 500 Index closed down 90.18 or 9.1% to 907.83, and Nasdaq Composite Index declined 150.68 or 8.5% to close at 1,628.33. In Toronto TSX Composite Index dropped 6.7% or 662.80 to 9,292.86.

Of the 30 stocks in Dow Jones Industrial Average only 1 closed higher.

Coca-Cola Company was the lone gainer in the Dow Jones Industrial Average with a rise of 1%.

Exxon Mobil led decliners in the Dow Jones Industrial Average with a fall of 14% followed by losses in American Express of 13.4%, in Citigroup Inc of 13%, in Alcoa Inc of 12.8%, in Chevron Corp of 12.5% and Caterpillar of 11.4%.

Of the stocks in S&P 500 index, 495 increased and 5 declined. Of the index stocks, 2 rose more than 3% and 481 fell more than 3%. And 220 stocks plunged more than 10%

Jones Apparel led the decliners in the S&P 500 index with a fall of 29% followed by losses in Southwestern Energy of 29.3%, in Chesapeake Energy of 24.3%, in Genworth Financial of 22.4%, in AK Steel Holdings of 21.4% and in SLM Corp of 21.2%.

Hudson City Bancorp led the gainers in the S&P 500 index with a rise of 4% followed by gains in General Growth Properties of 3.3%, in National City Corp of 2.9%, in Regions Financial of 2.6% and in Coca-Cola Company of 1.1%.

South American Markets Indexes

Brazil led decliners in the region with a rise of 13.7% followed by decrease in Argentina of 12% in Peru of 8.5%, in Colombia of 6.4%, in Mexico of 5%, in Venezuela of 0.6% and in Chile of 0.4%.

Europe Markets Review

In London FTSE 100 Index closed lower 314.62 or 7.16% to 4,079.59, in Paris CAC 40 Index decreased 247.45 or 6.82% to close at 3,381.07 and in Frankfurt DAX index lower 337.56 or 6.49% to close at 4,861.63. In Zurich trading SMI decreased 349.05 or 5.58% to close at 5,911.17.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed higher 99.90 or 1.06% to 9,547.47, Hang Seng index in Hong Kong decreased 834.58 or 4.96% closed to 15,998.30. CSI 300 index in China lower 20.26 or 1.05% closed to 1,914.36. ASX 200 index in Australia decreased 35.20 or 0.81% to close 4,300.00. The KL Composite index in Malaysia lower 16.18 or 1.67% closed to 949.88.

The Kospi Index in South Korea decreased 27.41 or 2.00% to close at 1,340.28. SET index in Thailand closed lower 19.27 or 3.85% to 481.50, and JSE Index in Indonesia decreased 35.56 or 2.29% to 1,520.41. The Sensex index in India decreased 674.28 or 5.87% closed to 10,809.12.

Commodities, Metals, and Currencies

Crude oil decreased $3.98 to close at $74.65 a barrel for a front month contract, natural gas decreased 12 cent to $6.61 per mBtu and gasoline futures decreased 5.56 cents to close at 178.00 cents per gallon.

Wheat futures closed down 17.250 cents in Chicago trading and closed at $5.55 a bushel. Sugar decreased 0.53 cent to 11.18 cents a pound. Soybean future closed down 38 cents to $8.58 a bushel.

Gold increased $5.60 in New York trading to close at $845.10 per ounce, silver closed down $0.70 cents to $10.36 per ounce and copper for the front month delivery increased 19.450 cent to $2.20 per pound.

Dollar edged higher against euro to $1.3492 and dropped against yen to 100.31.

Yields on 10-year U.S. bonds decreased to 3.98% and with 30-year maturities decreased to 4.22%.