Market opens with steep decline

Ellis Mnyandu
Reuters
October 15, 2008

Stocks slid on Wednesday as investors worried that efforts to ease the credit crisis would not avert a recession, overshadowing solid profits from Coca-Cola Co (KO.N) and Intel Corp (INTC.O).

• A d v e r t i s e m e n t

Investors’ mood soured when a government report showed that sales at U.S. retailers last month slid by the biggest monthly drop in more than three years. Consumer spending accounts for two-thirds of U.S. economic activity.

Investors sold shares of economic bellwethers, including Caterpillar Inc (CAT.N) , which fell 8 percent. Energy companies were another casualty as oil prices slid. Chevron (CVX.N) fell more than 6 percent.

U.S. crude for November delivery fell about 4 percent to $75.61 a barrel on the view that a recession would hurt energy demand.

“I think people are realizing there are interesting tools being put in place to deal with the credit crisis, but there’s going to be a lag time to get them to work,” said Arthur Hogan, chief market analyst at Jefferies & Co in Boston.

The Dow Jones industrial average (.DJI) slid 347.03 points, or 3.73 percent, to 8,963.96. The Standard & Poor’s 500 Index (.SPX) tumbled 43.99 points, or 4.41 percent, to 954.02. The Nasdaq Composite Index (.IXIC) dropped 53.96 points, or 3.03 percent, to 1,725.05.

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