US stock plunge amid barrage of bad news

US stock plunge amid barrage of bad news
WATCH VIDEO
Source: CCTV.com | 06-27-2008 09:10
In the US, the Dow Jones industrials dropped nearly 360 points on Thursday, that's a fall of three percent. It was the lowest finish in nearly two years. All the major indexes also lost around three percent.




A trader works on the floor of the New York Stock Exchange
June 20, 2008 in New York City. A major factor for
Thursday's fall was oil. Analysts say crude touched a fresh
record above 140 US dollars a barrel, setting off new
worries. (AFP/Getty Images/File/Spencer Platt)


A major factor for Thursday's fall was oil. Analysts say crude touched a fresh record above 140 US dollars a barrel, setting off new worries.

But oil was not the only problem. Shares of General Motors fell to their lowest level in half a century after Goldman Sachs advised clients to dump the stock. Investors also pounded shares of blackberry maker Research in Motion on signs profit growth is slowing. A disappointing outlook from software giant Oracle added to fears technology spending is waning.

Alec Young, analyst Standard & Poor's, said, "We're seeing some new negatives emerge. We had worse-than-expected guidance from Nike, Research in Motion and a few other key companies and so that's got people feeling that earnings risks are spreading from the financial area to other areas of the economy, other areas of the market and that's what's really driving the heavy selling today."

Alec Young also warned investors' profit expectations as they look into the second half of 2008 may still be too high as the economy remains weak in housing, job and credit markets.

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