DOW plunges 400 points in panic selloff
fox43.com ^ | 4 Aug 2011 | Annalyn Censky
NEW YORK -- Stocks plunged Thursday, with the Dow tumbling 400 points to hit its lowest level since December, as global economic fears gripped the market.
U.S. markets were already sharply lower on widespread worries, including the weak job market. But the selling gained momentum as Japanese and European policymakers stepped in with dramatic measures to shore up their financial markets.
There's "total fear" in the market, said Bob Doll, chief equity strategist at the world's largest money manager, BlackRock.
All three major indexes tumbled more than 3% Thursday and erased all their gains for the year. The indexes have also pushed into 'correction' territory - defined as a 10% drop from their highs earlier this year. Over the past 10 days alone, the Dow, S&P 500 and Nasdaq have dropped more than 8%.
"In the last two weeks, we've been through the ringer," said Rich Ilczyszyn, market strategist with futures broker Lind-Waldock. "When we start looking at the recovery, there's nothing to hang our hats on anymore."
The market's fear gauge -- the VIX -- surged 18% to a reading of 27.6. That's still just shy of 30 -- the level that signals a high degree of fear. With the VIX up 57% from the start of the year, it's clear that fear has been escalating.
In afternoon trading Thursday, the Dow Jones industrial average was down 400 points, or 3.3%, with Alcoa, Caterpillar and Bank of America among the biggest drags on the blue chip index. The only gainer was Kraft, following news that the company plans to split itself in two.
The S&P 500 was down a staggering 44 points, or 3.5%.
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