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Wall Street sinks below 8,000

(Chinadaily.com.cn)
Updated: 2008-11-21 11:02

Wall Street has dropped to levels not seen since 2003.

The Dow Jones industrial average plummeted below the 8,000 mark on Wednesday, as the fate of Detroit's Big Three automakers and the economy disheartened investors.

The Dow finished down nearly 430 points at the 7,990 level. Stocks finished at their lows of the session after the "Big Three" automakers pleaded for relief during a second day of hearings in Washington.

The heads of General Motors, Ford and Chrysler are asking for a massive infusion of cash to prevent millions of layoffs and stave off bankruptcy.

Economic worries caused across-the-board selling, with financial stocks particularly hard hit.

At the same time, investors are discouraged by the Federal Reserve's sharply lowered projection for economic activity this year and next.

The Fed predicts that with the economy forecast to lose traction or maybe jolt into reverse, unemployment will move higher.

According to the Labor Department's Consumer Price Index, consumer prices plunged by the largest amount in the past 61 years in October.

And gasoline pump prices dropped by a record amount. Meanwhile, a government report on the housing sector showed that the industry's severe correction is continuing.

The Commerce Department reported that construction of new homes plunged 4.5 percent last month to the lowest level on government records