Stocks get hammered, day 2

Dow off about 100 as nervousness returns; energy and tech hardest hit; bond gain.

By Alexandra Twin and Rob Kelley, CNNMoney.com staff writers

NEW YORK (CNNMoney.com) -- Energy and technology stocks led the market lower Friday as a small morning decline turned into a broad afternoon sell-off in one of the toughest weeks in recent Wall Street history.

The Dow Jones industrial average (Charts) tumbled about 100 points with two hours left in the session while the broader S&P 500 (Charts) index fell 1.0 percent.

dow_by_numbers.gif
Is the stock selloff just a blip or the start of a longer downturn?
  • Blip
  • Longer slump
  • Too early to say

The Nasdaq (Charts) composite slipped 1.2 percent.

As of Thursday's close, the Dow and S&P 500 were both down 3.3 percent for the week, while the Nasdaq was off 4.4 percent.

Investors are still reacting to Tuesday's battering that sent the Dow down 416 points, its biggest one-day point loss since the day the market reopened after the Sept. 11, 2001 attacks.

That decline was sparked by a selloff in the Shanghai market that quickly spread around the world.

After taking a breather Wednesday, stocks fell Thursday though declines were modest as investors fought back from a steeper morning swoon.

Declines started small Friday but the selling picked up as the session wore on.

"I think we've seen a correction this week, not the start of something bigger," said Douglas Roberts, managing principal at Channel Capital Research. "We're seeing a lot of fear in the market, yet the fundamental economic conditions haven't changed."

The supportive economic environment - slower, but not too slow growth, paired with declining inflation, should help stocks going forward, he said. Although there could be a little more downside in the short term, Roberts said he thinks the longer-term direction is going to be "kind of a slow grind upward."

Late Thursday, Dell (Charts) reported lower quarterly earnings that topped estimates on lower quarterly revenue that missed estimates. The company also cautioned that growth and profit margins will be limited over the next few quarters. The stock inched higher Friday.

AIG (up $2.37 to $69.78, Charts) reported higher quarterly earnings late Thursday that nonetheless missed analysts' forecasts. The Dow component also said it would buy back $5 billion in stock in 2007 as part of a broader $8 billion stock buyback plan. The shares rallied 3.6 percent Friday.

Novell (down $0.25 to $6.46, Charts) reported a quarterly loss late Thursday, down from a profit a year ago. Analysts were expecting a 1-cent a share profit, on average. Shares of the software maker sank 4 percent Friday morning.

Among other movers, a variety of Internet shares fell, including eBay (down $0.85 to $31.08, Charts), Yahoo! (down $0.42 to $30.44, Charts) and Google (down $7.59 to $440.64, Charts).

Shares of Palm (Charts) rallied amid reports that the maker of the Treo smart phone could be the subject of a takeover attempt by Nokia (Charts).

On the economic front, investors eyed the revised reading on February consumer sentiment from the University of Michigan. The index fell to 91.3 from the originally reported 93.3. Economists surveyed by Briefing.com thought it would hold steady.

Also in focus: comments from Fed speakers. St. Louis Federal Reserve Bank President William Poole, speaking at a business luncheon in Santiago, Chile, said the economy was not headed for a recession.

Poole's comments were in contrast to comments made by former Fed Chairman Alan Greenspan, who said earlier in the week that a recession was possible, though not likely, later this year.

Fed Chairman Ben Bernanke speaks at Stanford University in California this evening.

In currency trading, the dollar fell further versus the euro and the yen. The yen surged anew as investors continued to close out carry trades, or bets on riskier currencies bought by borrowing in the currencies of countries with low interest rates, like Japan.

Treasury prices inched higher, lowering the yield on the benchmark 10-year note to 4.52 percent from 4.55 percent late Thursday. Bond prices and yields move in opposite directions.

U.S. light crude oil for April delivery fell 28 cents to $61.72 a barrel on the New York Mercantile Exchange.

COMEX gold for April delivery slumped $21.90 to $643.20 an ounce.

Market breadth was negative. On the New York Stock Exchange, losers beat winners two to one on volume of 1.03 billion shares. On the Nasdaq, decliners topped advancers two to one on volume of 1.4 billion shares.


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Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer. Morningstar: © 2018 Morningstar, Inc. All Rights Reserved. Factset: FactSet Research Systems Inc. 2018. All rights reserved. Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor's Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2018 and/or its affiliates.

Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer. Morningstar: © 2018 Morningstar, Inc. All Rights Reserved. Factset: FactSet Research Systems Inc. 2018. All rights reserved. Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor's Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2018 and/or its affiliates.