Thursday, August 04, 2011

Economic worries spark steep sell off on Wall Street

NEW YORK — Worries about the state of the economy in the U.S. and around the world slammed stocks on Thursday, driving the Dow briefly down more than 400 points and sending the S&P 500 into correction territory.

Bonds soared as investors sought a safe place to park their money.

The Dow Jones industrials average was down about 3 percent. The broader S&P 500 index was down around 10 percent from its May high. The market's so-called "fear index," the CBOE Volatility Index (VIX), jumped to its highest since March.

"People are throwing in the towel because they can't find relief on any front. There are a lot of worries about the economy," said Milton Ezrati, market strategist at Lord Abbett Co. in Jersey City, New Jersey, which manages $110 billion in assets.

Analysts predicted further losses ahead, given the strong degree of pessimism in the market.
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