Make us your home page

Dow loses 353 points; stocks drop globally

NEW YORK — U.S. stocks tumbled Thursday, with the Standard & Poor's 500 suffering its worst session since November 2011, hit by fear that the Federal Reserve will scale back its bond purchases later this year.

Asian and European stocks, along with gold, oil and Treasury bonds, also posted steep declines.

The Dow Jones Industrial Average ended down 353.87 points, or 2.3 percent, to 14,758.32, with all of its 30 components in negative territory. The S&P 500 index dropped 40.74 points, or 2.5 percent, to 1,588.19, marking its biggest decline since November 2011. The Nasdaq composite lost 78.57 points, or 2.3 percent, to 3,364.63.

Gold futures dropped $87.70 an ounce to close at $1,285.90 on the New York Mercantile Exchange.

Federal Reserve Chairman Ben Bernanke said Wednesday that the central bank may begin to scale back its $85 billion-a-month bond-buying program, called quantitative easing, later this year if the economy continues to show strength.

The stock market's big advance since 2009 has in part been fueled by Fed policies that have punished other asset classes and encouraged investment via equities. But at the same time, the end of such policies also should be cause for some celebration among stock investors, according to some analysts.

Kim Forrest, senior equity analyst at Fort Pitt Capital Group, said she's a value investor looking for mispriced yet attractive stocks to hold for at least three years, and therefore she and her colleagues aren't selling now. "When the market swoons like this, it's a buying opportunity," she said. Investors should be looking for entry points, although not necessarily today, she said.

Other strategists are cautious.

"Near term, it is recommended investors wait for sentiment to turn extremely pessimistic before new buying," said Bruce Bittles, chief investment strategist at R.W. Baird.

The Dow notched its eighth straight triple-digit move, nearing a record set in 2008, when there were 10 swings of that magnitude.

In economic news Thursday, initial weekly jobless claims rose by 18,000 to a seasonally adjusted 354,000. Economists polled by MarketWatch had expected claims to rise to 340,000.

The Conference Board's index of leading indicators edged up 0.1 percent in May to 95.2. That was slightly less than the 0.2 percent gain forecast by economists.

Wednesday's post-Fed rout extended to global markets, with the Hang Seng Index and the Shanghai Composite Index each tumbling close to 3 percent on Thursday. Fed worries were piled on top of a Chinese purchasing managers' index that hit a nine-month low, according to preliminary HSBC data.

In Europe, stocks fell sharply, with Germany's DAX dropping 3.3 percent and the Stoxx Europe 600 index falling 3 percent.

Oil futures fell $2.84 to end at $95.40 a barrel, while the U.S. dollar shot higher against other major currencies.

Dow loses 353 points; stocks drop globally 06/20/13 [Last modified: Thursday, June 20, 2013 9:26pm]
Photo reprints | Article reprints

Copyright: For copyright information, please check with the distributor of this item, Tribune News Service.

Join the discussion: Click to view comments, add yours

  1. New DEP secretary says there's no conflict in political side businesses


    TALLAHASSEE — When Noah Valenstein, the newly appointed head of the Department of Environmental Protection, was applying in April to be the state's top environmental regulator, he left one thing off the application: Companies he started and his wife runs have been paid nearly $1 million by politicians and lobbying …

     Noah Valenstein got the job as secretary of the Department of Environmental Protection on Tuesday May 23rd, on a unanimous vote by Gov. Rick Scott and the Cabinet. He will take the helm on June 5, with a salary of $150,000 per year. [Florida Governor's Office]
  2. New stores coming to Tyrone Square Mall, like Bath & Body Works


    Tyrone Square Mall will welcome a half dozen new stores, like Bath & Body Works and MidiCi's The Neapolitan Pizza Company, this summer.

  3. Target Corp. reaches $18.5 million settlement with 47 states over data breach


    Target Corp. has agreed to pay Florida $928,963 out of a newly-announced $18.5 million settlement over a huge data breach that occurred in late 2013.

    Forty-seven states and the District of Columbia have reached an $18.5 million settlement with Target Corp. to resolve the states' probe into the discounter's massive pre-Christmas data breach in 2013. 
[Associated Press]
  4. Gov. Rick Scott's family history of alcohol abuse could decide 'liquor wall' bill


    TALLAHASSEE — Gov. Rick Scott must decide Wednesday whether to let Walmart and other big-box stores sell liquor, and he says a factor in his decision is the history of alcohol abuse in his family.

    Florida Governor Rick Scott is considering a veto of a bill that would allow Walmart, Target and other big box retail stores to sell liquor. [Andres Leiva | Tampa Bay Times]
  5. Tampa lands Super Bowl in 2021


    TAMPA — Record rainfall in Los Angeles ultimately may end Tampa Bay's drought of hosting the Super Bowl.

    Mike Tomlin celebrates with LaMarr Woodley and Troy Polamalu after the Steelers beat the Cardinals in 

Super Bowl XLIII  on February 1, 2009 at Raymond James Stadium in Tampa. [Times files (2009)