Skip to comments.CNBC-Dow Drops Below 6,900 as AIG Rattles Market (6831 NOW!)
Posted on 03/02/2009 9:03:40 AM PST by tcrlaf
The Dow Jones Industrial Average hit its lowest level in 12 years, slipping below 7,000, and then 6,900, as investors grew increasingly skittish over the state of the stock market amid the wave of government bailouts.
The Dow Jones Industrial Average dropped more than 200 points, or nearly 3 percent.
The S&P 500 continued its descent toward 700, while the Nasdaq dropped below 1,350.
The Nasdaq suffered the least of the three major indexes as Intel and Dish Network provided a few glimmers of hope amid the wreckage.
Major U.S. Indexes.DJIA6827.57-235.36-3.33%946,324,000.NCOMP1336.68-41.16-2.99%318,253,300.SPX707.24-27.85-3.79%2,318,764,800
And, while some investors thought the selling was coming to a close, it can get worse from here, Art Cashin, director of floor operations at UBS, told CNBC.
"You're beginning to hear people get a little more despondent as this continues to sell day after day," Cashin said. "There's a growing sense of frustration about not quite being in control here Not knowing where the next shoe in Imelda Marcos's shoe closet is," Cashin said.
He pegs the next key level at 700 in the S&P.
Financials led the broader decline as another government intervention scared the market.
The big bailout news for Monday focused on American International Group, which reported a $61.7 billion quarterly net loss, after the government was forced to pump billions in fresh capital into the insurance giant the third such cash infusion.
The $30 billion bailout provided a stark reminder that some of Americas biggest corporations are still in a critical condition.
Shares of AIG [AIG 0.48 0.06 (+14.36%) ] gained sharply following news of the capital injection and earnings.
But the climate of uncertainty continued to spread havoc through the market, particularly in financials.
"The market has yielded on so many support levels here and I think there's a level of emotional despondency starting to build," Art Cashin, director of floor operations with UBS, said on CNBC. "We may start to talk about capitulation here."
But I'm not hopeful, as when I look around the nets today, I see all of the Lib boiler-rooms saying "BLAME BUSH!!" everywhere....
Uh, I thought we were in for CHANGE. Looks to me like this is more of the same - With a vengeance!
I swear......... when it gets down to about 3500, I’m gonna jump back into the market. (heavy on the satire here)
I swear I’m going to cash out my 401k. There won’t be anything left soon!
Won’t the DOW suspend trading at a certain point?
Obama and his ilk have been successful in blaming Bush policies for this mess and Bush solutions as only helping the rich. We are seeing the perfect storm of misinformation and will not be easily fixed.
"As long as AIG gives us kickbacks, AIG will last longer than America."
Dunno-—certainly I’m not an expert or I would be on a beach in Aruba-—but I think it’s entirely possible for this market to go to 4,000 before ANYTHING turns around.
Obama supposedly won on the premise he could take care of all of this!! THIS STATE OF AFFAIRS is all on his shoulders, he signed this stupid stimulus bill, now he can suffer the consequences, as in a big drop in poll numbers. If it were not for the media whores, the whole country would know this by now.
Blame socialism. The Dems wanted socialism-lite but they did not think the middle class would be wiped out by it.
I believe this so called ‘change we can believe in’ is destroying our economy.
Q: What have we got now?
Or, done them in.
“I swear......... when it gets down to about 3500, Im gonna jump back into the market. (heavy on the satire here)”
I’m seriously looking at the 4000-5000 range myself.
I have already cashed in one and going to cash in the other very quickly. Have seen both drop to half of what they were worth.
First-Quarter 2009 Circuit-Breaker Levels
The New York Stock Exchange will implement new circuit-breaker collar trigger levels for first-quarter 2009 effective Friday, January 2, 2009.
Circuit-breaker points represent the thresholds at which trading is halted marketwide for single-day declines in the Dow Jones Industrial Average (DJIA). Circuit-breaker levels are set quarterly as 10, 20 and 30-percent of the DJIA average closing values of the previous month, rounded to the nearest 50 points.
In first-quarter 2009, the 10, 20 and 30-percent decline levels, respectively, in the DJIA will be as follows:
Level 1 Halt
A 850-point drop in the DJIA before 2 p.m. will halt trading for one hour; for 30 minutes if between 2 p.m. and 2:30 p.m.; and have no effect if at 2:30 p.m. or later unless there is a level 2 halt.
Level 2 Halt
A 1,700-point drop in the DJIA before 1:00 p.m. will halt trading for two hours; for one hour if between 1:00 p.m. and 2:00 p.m.; and for the remainder of the day if at 2:00 p.m. or later.
Level 3 Halt
A 2,600-point drop will halt trading for the remainder of the day regardless of when the decline occurs.
Circuit-breakers are calculated quarterly. The percentage levels were first implemented in April 1998 and are adjusted on the first trading day of each quarter. In 2009, those dates are Jan. 2, April 1, July 1 and Oct. 1.
That will show those evil rich capitalists...
More layoffs to follow...
It’s reaction to the turd budget Obama laid.
The liberals had better be screaming, every time the market goes further south, that’s more tax revenue that goes out the door, and more pet liberal programs that get trashed.
But I guarantee that the White House is starting to listen to the market, and trying to figure out what the heck to do next that still fits within their schemes. Honestly, it’s probably going to tank further, but hopefully bottom out at 5,000 - much below that, and it’ll be one heck of a long recovery, probably outliving The One’s two terms (since we can’t seem to find someone in the party to talk about smaller government...)
We are all sitting here watching our entire lifetime work being wiped out in a matter of a few months. Worse, it is being caused by abject manipulation by those who are supposedly working to protect us. This is the scariest time in the history of the USA. At this pace we will be in a depression by the end of the year. We are abandoning long term partners with what we are doing in Israel. When is this madness going to stop?