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WORLD> America
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US stocks plunge after rescue plan unveiled
(Agencies)
Updated: 2009-02-11 09:47
NEW YORK: US stocks plunged Tuesday as markets gave a thumbs down to a plan unveiled by President Barack Obama's administration to stabilise the financial system.
The Dow Jones Industrial Average slid 381.99 points or 4.62 per cent to 7,888.88 at the close.
The tech-heavy Nasdaq points was down 66.83 points (4.20 per cent) to 1,524.73 and the broad Standard & Poor's 500 index fell 42.73 points (4.91 per cent) to 827.16.
Investors were concerned the financial stabilisation plan unveiled by US Treasury Secretary Timothy Geithner might prove inadequate, some experts said. The plan included an initial fund of US$500 billion to absorb toxic assets clogging the financial system. It also involves new efforts to boost consumer lending, limit home foreclosures and provide new capital for banks.
"It appeared to be a work in progress, and lacked specifics on addressing toxic assets," said Wachovia Securities chief market strategist Al Goldman.
The lack of details and skepticism surrounding how the government will price the toxic banking assets "are hurting sentiment on the Street and toward the financial sector," experts at Schwab & Co wrote.
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