U.S. stocks fall on global recession fears

U.S. stocks fall on global recession fears

Traders work on the floor of the New York Stock Exchange, October 23, 2008.(Xinhua/Reuters Photo)


NEW YORK, Oct. 24 (Xinhua) -- Wall Street tallied steep losses but off the worst level Friday, after carmakers and technology companies reported disappointing profits and as fears of a prolonged, severe global recession stimulated panic among investors.

Toyota Motor Corp., the world's second-largest automaker, reported its sales dropped 4.3 percent in the third quarter, the first sales decline in seven years. General Motors and Ford lost ground on the news.

Crude oil tumbled to a 16-month low despite OPEC's decision of producing reduction. Exxon Mobil and Chevron led energy sector down.

Moreover, the technology sector was also traded lower, after Samsung, Asia's biggest maker of chips, posted its worst profit drop in over three years.

Today's sell-off also followed the rocky performance of overseas equity market. In Japan, NIKKEI tumbled after Sony slashed its earnings forecast for the fiscal year. The British government said its gross domestic product fell 0.5 percent in the third quarter, putting the country on the brink of recession and triggered a rout of Britain's FTSE 100. Moreover, Hong Kong's Hang Seng index also got hammered.

The negative news worldwide plagued investors who worried the world economy is headed for a long and severe recession. Big hedge funds, and other institutional investors as well as individual investors rushed to run away from the market, which dragged major indexes sharply lower.

The Dow Jones Industrial Average fell 312.30, or 3.59 percent, to 8,378.95 after falling 504 in the early session. The S&P 500 index declined 31.34, or 3.45 percent, to 876.77, and the Nasdaq composite index fell 51.88, or 3.23 percent, to 1,552.03.