Our Terms of Service and Privacy Policy have changed.

By continuing to use this site, you are agreeing to the new Privacy Policy and Terms of Service.

Stocks slide on economic weakness

U.S. markets take a hit after a report on services activity shows signs of a recession.

Subscribe to Markets
google my aol my msn my yahoo! netvibes
Paste this link into your favorite RSS desktop reader
See all CNNMoney.com RSS FEEDS (close)

NEW YORK (CNNMoney.com) -- Stocks skidded at Tuesday's open after a report on nonmanufacturing activity pointed to a recession.

The Dow Jones industrial average fell about 1.4%. The Nasdaq composite index lost about 1.5%. The Standard & Poor's 500 index was 1.7% lower.

The Institute of Supply Management's services activity index plunged in January to 41.9 from 54.4, a reading that signals contraction in the sector and hints at a recessionary economy.

Among stocks in the news at the open:

News Corp.: Media company News Corp. (NWS, Fortune 500) posted results late Monday about in line with analysts' estimates and said it is not considering a bid for Internet giant Yahoo (YHOO, Fortune 500).

Yahoo: Shares were downgraded to "hold" from "buy" late Monday by Soleil and early Tuesday by Bank of America.

Boston Scientific: Medical device maker Boston Scientific (BSX, Fortune 500) said it swung to a net loss of $458 million in the latest quarter, but earnings excluding items beat forecasts and the company raised first-quarter guidance.

Walt Disney: Media company Walt Disney (DIS, Fortune 500) is due to report quarterly results after the market close.

Apple: Computer and electronics maker Apple (AAPL, Fortune 500)added new models of the iPhone and iPod touch Tuesday that double the memory capacity of earlier models. To top of page

Photo Galleries
The stock market's wild week in 6 pictures It was the wildest week in stocks in recent memory. Here's photos and CNNMoney's tweets of reactions to the panicked selling on Monday and Tuesday, which gave way to a mad buying scramble on Wednesday and Thursday. And then...a selloff on Friday again. More
How New Orleans is learning to live with water After Hurricane Katrina, the city of New Orleans had to reinvent the way it manages water and protects itself from future storms. More
Your degree will earn you the most from these colleges Art majors can make big bucks, too. Find out which school has the highest paid grads in your major. More