NEW YORK TIMES: Stock markets plunged on Thursday as investors confronted a troubling manufacturing report and new indications of the depth of subprime losses and housing woes. The Dow Jones industrial average lost more than 300 points.
The Standard and Poor’s 500-stock index, a broad measure of the financial markets, tumbled below its low for last year, set in March. At the close, it was down 2.9 percent after giving up early morning gains, bringing its decline since Jan. 1 to 9.2 percent.
The Dow Jones industrial average ended down 306.95 points, or 2.5 percent, at 12,159.21, and the technology-heavy Nasdaq composite index was off 2 percent.
A dismal report on manufacturing activity caught investors by surprise on Thursday morning, sending the main indexes into the red after an early stint in positive territory.
The Federal Reserve reported that a survey of Philadelphia-area manufacturers contracted much more than expected. A similar drop in the index occurred in early 2001, just before the onset of the last recession.
“Basically every day now, you have more and more investors leaning toward the camp that yes, this is going to be a recession, and it could be a severe one,” said David Kovacs, a quantitative investment strategist at Turner Investment Partners in Berwyn, Pa.
Recession fears have been roiling the market of late, sending the S.& P. down 8 percent since the beginning of the year. Dow Plunges More Than 300 Points on Grim Outlook >>> By Michael M. Grynbaum
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