U.S. Stocks Tumble, Sending Dow Below 9,000; GM, Insurers Slide By Lynn Thomasson
Oct. 9 (Bloomberg) -- U.S. stocks slid and the Dow Jones Industrial Average fell below 9,000 for the first time since 2003 as higher borrowing costs and slower consumer spending spurred concern carmakers, insurers and energy companies will be the next victims of the credit crisis. General Motors Corp. tumbled 31 percent and Ford Motor Co. slumped 22 percent as the outlook for car sales worsened. XL Capital Ltd. lost 54 percent and led a gauge of insurers to a 13-year low on concern investment losses will curb results. Exxon Mobil Corp.'s biggest drop in 21 years accelerated the Dow's decline in the final hour of trading as oil retreated below $85 a barrel. Morgan Stanley plunged 26 percent as short sellers returned to the market after a three-week ban. ``The sickening slide in the market is unbelievable,'' said Jerome Dodson, a fund manager who oversees $1.7 billion at San Francisco- based Parnassus Investments. ``Investors are worried about the freezing up of the credit markets.'' The S&P 500 retreated for a seventh day, losing 74.93 points, or 7.6 percent, to 910.01 to cap its longest streak of daily declines since 1996. The Dow Jones Industrial Average declined 678.91, or 7.3 percent, to 8,579.19. The Nasdaq Composite Index decreased 5.5 percent to 1,645.12. Twenty stocks fell for each that rose on the New York Stock Exchange. Worst Slide Since '37 The S&P 500 extended its 2008 tumble to 38 percent, poised for its worst yearly performances since 1937, even as its valuation compared with estimated earnings is the cheapest versus reported earnings since 1985. GM lost $2.15 to $4.76, while Ford slumped 58 cents to $2.08. The automakers may not receive $25 billion in loan guarantees from the U.S. government in time to help them survive the crises in the credit and equity markets, according to the Globe and Mail newspaper, citing a Citibank Inc. analyst. XL Capital plunged $4.67 to $4.01 for the steepest decline in the S&P 500. The company was removed from Goldman Sachs Group Inc.'s ``conviction buy'' list yesterday on ``concern regarding the quality of XL's investment portfolio.'' To contact the reporter for this story: Lynn Thomasson in New York at [EMAIL PROTECTED] --~--~---------~--~----~------------~-------~--~----~ Thanks for being part of "PoliticalForum" at Google Groups. For options & help see http://groups.google.com/group/PoliticalForum * Visit our other community at http://www.PoliticalForum.com/ * It's active and moderated. Register and vote in our polls. * Read the latest breaking news, and more. -~----------~----~----~----~------~----~------~--~---
