Thread: BREAKING NEWS: Dow down 550+ points, falls below 11,000

Dow falls more than 300 in panic selling

The sell-off is prompted by S&P's downgrade of U.S. debt and worries about Europe's financial system. Fannie Mae and Freddie Mac are downgraded as well. Gold tops $1,700, and oil drops below $84. Bank of America shares fall 15%.

By Charley Blaine on Mon, Aug 8, 2011 12:28 PM
Updated: 12:47 p.m. ET

The Great Selloff of 2011 became the Great Panic of 2011 as worries about European debt problems and the impact of Standard & Poor's downgrade of U.S. debt on domestic and global growth combined to push stocks to their lowest levels since October.

The Dow Jones industrials ($INDU) slumped at the open and fell as many as 385 points by 10:35 a.m. ET before rebounding slightly. The Standard & Poor's 500 Index ($INX) and the Nasdaq Composite Index ($COMPX) fell as much as 4% before losses were trimmed to around 3%. Stocks in Asian and Europe also slumped.

Bank of America (BAC) was off 15.2% as fears mounted it won't be able to handle all the problems created by its mortgage business. The selling accelerated after a big hedge-fund manager sold out his stake,

What investors really wanted today was safety. So, they bought Treasury securities, the very obligations that were downgraded. The 10-year Treasury yield fell to to 2.377% from Friday's 2.558%. And, of course, they wanted gold (-GC). Gold topped $1,700 for the first time, hitting as high as hit $1,718.20 in overnight trading. It was trading at $1,706.80 at noon ET.

At 12:47 p.m. ET, the Dow was off 315 points, or 2.8%, to 11,130, potentially its 10th loss in the last 12 days. The blue chips have fallen more than 1,600 points to July 22. The S&P 500 was off 45 points, or 3.7%, to 1,155, and the Nasdaq was off 98 points, or 3.9%, to 2,434.

Video at the link:

"Not only is the economy not growing as most would like, but there is a concern that fiscal and monetary authorities are powerless to do more for the economy," Michael Pond, co-head of interest-rate strategy for British bank Barclays (BCS).

Crude oil (-CL) was at $83.48 a barrel, down $3.32, or 3.8%. It was its lowest level since November. Brent crude was off $3.43, or 3.1%, to $105.94. Silver (-SI) was up $12.10 an ounce to $39.31 an ounce. Copper (-HG) was off 13.8 cents to $3.979 a pound.

Meanwhile S&P said it was downgrading the debt of Fannie Mae (FNMA) and Freddie Mac (FMCC), the big providers of mortgage capital, and other U.S. agencies.

Europe's problems may be more serious

While Americans can be excused for thinking the S&P downgrade was the big event, the European debt crisis was more dangerous.

That's because the European Central Bank has been forced for the first time to prop up the debt of Italy and Spain, two of its biggest member nations. Italy's and Spain's bond have been under attack from speculators who aren't convinced either nation can keep current on their debts.

As a result, Germany's Dax Index ($DEAX) was off 5% to 5,923. Britain's FTSE-100 Index ($GB:UKX) was off 3.4% to 5,069.

http://money.msn.com/market-news/post.a ... &GT1=33009

BREAKING NEWS: Dow down 550+ points, falls below 11,000. More ....

http://investing.money.msn.com/investme ... &GT1=33009

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Flash Crash Part 2

Submitted by Tyler Durden
08/08/2011 14:34 -0400

With QE3 to be announced tomorrow, is anyone really surprised that we just experienced Flash Crash part 2? Dow dropping as much as 600, BAC down 22%, Citi down 21%, and everything else bidless, Level two does not work... Total market shut down.

http://www.zerohedge.com/news/flash-crash-part-2

related

EPIC PLUNGE: -633.78, 6th Largest Drop In Dow Jones History

http://www.zerohedge.com/news/epic-plun ... es-history

And there you have it: following last Thursday's massive 500 point drop which so many said was a buying opportunity, here comes a -633.78 plunge in the DJIA, which is the 6th largest absolute point drop in Dow Jones Industrial Average history, following 4 larger drops in 2008 following the Lehman bankruptcy, and one back in 2002. We just made history. If the DJIA can drop more than 800 points tomorrow, which it probably will if Bernanke does not announce QE3 in some form, 2011 will be #1!

The Dow crashed 635 points today.

http://georgewashington2.blogspot.com/

This is the worst plunge since 2008, and the sixth biggest crash in history