Stocks ended another dizzying day of volatility with huge declines Friday, capping off another round of bleeding on Wall Street.
Today's Market
The Dow Jones Industrial Average lost 337.94 points, or 3.82%, to 8497.31, the broader S&P 500 fell 38.00 points, or 4.17%, to 873.29 and the Nasdaq Composite slid 79.85 points, or 5.00%, to 1516.85. The consumer-friendly FOX 50 dropped 25.23 points, or 3.63%, to 668.91.
The scene at this closing bell was the polar opposite of Thursday's late surge as the Dow plummeted more than 350 points in the final 30 minutes alone. The selling appeared to be unprovoked but showed fresh signs of WallStreet's continued anxiety.
“I think investors are learning that any huge rally you get is something to be sold instead of a new bull market," said Paul Nolte, director of investment at Hinsdale Associates.
The latest selloff comes amid another barrage of bleak economic data, including the worst monthly retail sales performance on record and confirmation that consumer sentiment remains at recessionary levels.
“At some point all of this bad news, and it’s been pretty bad, will get priced in and we’ll be off to the races. Is it today? Probably not," NYSE trader Ted Weisberg of Seaport Securities told FOXBusiness.
The losses cut into the Dow's 553-point surge on Thursday, a dramatic move that also came without a clear catalyst.
Volatility continues to reign on Wall Street as the Dow swung in a very wide range of almost 1,000 points this week. By the time the dust had settled, the benchmark U.S. index was off by roughly 450 points this week, mirroring last week's disappointing performance.
Nearly all 30 components of the Dow ended in the red onFriday, led by plunging shares of JPMorganChase(JPM), Intel (INTC) and Home Depot (HD). Those losses offset modest gains from GeneralMotors(GM) and Citigroup (C), two of this week's most beaten down stocks.
The Nasdaq Composite performed much worse than the broader market, dragged down by steep losses from tech companies like Research in Motion (RIMM) and Activision Blizzard (ATVI).Tech stocks have slumped after Intel slashed its guidance earlier this week.
There was no shortage of negative headlines to blame the day's selloff on, including a sharp decline in retail sales, confirmation the euro-zone economy is in recession and weak outlooks given by a number of companies like J.C. Penney (JCP).
The government's retail sales report served as a fresh warning of how consumers are pulling back from making purchases during this period of economic uncertainty. The Commerce Department said October retail sales declined by a worse-than-expected 2.8% -- the weakest monthly performance since records began in 1992.
Market confidence wasn't helped by confirmation from the European Union that the euro-zone economy is in the midst of its first recession since the currency was introduced in 1999. The news comes as the governments of Hong Kong and Italy say their economies have also slipped into a recession and fears grow that the U.S. could see its deepest contraction since the 1980s.
Wall Street was given a series of new reminders of how the weak economy is impacting struggling companies as phone maker Nokia (NOK), Abercrombie & Fitch (ANF) and J.C. Penney (JCP) all announced weak outlooks for the current quarter.
Hours after the retailers cut their forecasts, the Reuters/University of Michigan mid-November sentiment index showed consumer sentiment remains at a depressed levels but improved slightly to 57.9. That is just a tick higher than October's reading, which showed sentiment collapsed amid the credit crisis, causing the index to suffer its steepest monthly decline since the survey began in 1978.
The markets had little reaction to a speech in Europe Friday morning by Federal Reserve Chairman Ben Bernanke, who said central banks stand ready to "take additional steps" if needed and that the financial markets"remain under severe strain."
Meanwhile, leaders in Washington continue to debate the merits of a rescue effort to save the Big Three auto makers, but Sen. Chris Dodd warned on Thursday he doesn't believe there is enough support from Republicans in the Senate to approve a bailout in a lame-duck session.
Analysts have said General Motors (GM) needs a rescue package to avoid a bankruptcy filing early next year that could cause millions of job losses in an already weak economy.
On the energy front, crude oil futures returned to the red Friday on continued economic concerns. Crude closed down $1.20 to $57.04 a barrel but had been much lower earlier. Gold, however, ended sharply higher, soaring $37.50 to $742.40 an ounce.
Corporate Movers
Freddie Mac(FRE), the mortgage giant seized by the U.S. earlier this year, posted a massive quarterly loss of $25.3 billion amid housing conditions that worsened "dramatically" in the third quarter. The losses forced Freddie to ask the government for $13.8 billion.
Citigroup (C) is slashing at least 10,000 jobs and raising interest rates on millions of credit-card customers by three percentage points, The Wall Street Journal reported.
Sun Microsystems (JAVA) announced it plans to cut 5,000 to 6,000 jobs, or 15% or 18% of its workforce, as part of a plan to save up to $800 million a year.
J.C. Penney (JCP) beat the Street with third-quarter earnings of 55 cents per share but issued a weaker-than-expected fourth-quarter outlook. The retailer sees sales declining 7 % to 9% this quarter after an 8.7% slide in the third quarter.
Abercrombie &Fitch (ANF) fell sharply after the retailer cut its full-year outlook well below analyst expectations and slashed its capital spending plans. The outlook overshadowed a better-than-expected quarterly profit of 72 cents per share.
Data Dump
The government said U.S. import prices plunged 4.7% inOctober -- the largest monthly decline since records began in 1988. The sharp drop in prices came as the economy continued to slow and crude oil prices fell sharply.
The Commerce Department said business inventories shrank by the most in three years in September as companies brace for a recession. Inventories fell by 0.2% in September, worse than the 0.1% decline economists had forecasted.
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