U.S. Markets Plunge, International Markets Mixed

The Dow Jones Industrial Average, S&P 500, and Nasdaq all dropped more than 5 percent today, reports the New York Times in a piece titled "Markets Plunge Despite Hint of Rate Cut". Clearly, the much-discussed bailout plan is still failing to halt the downward spiral in world markets. The Federal Reserve is still desperately trying to think of new schemes to bring markets under control, including interest rate cuts and more unconventional expansions of Fed authority to lend directly to financial institutions.

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“Nobody trusts anybody right now,” said Ryan Detrick, an analyst at Schaeffer’s Investment Research. “No one’s lending to each other.”

In London, the FTSE 100 ended up 0.4 percent. The CAC-40 in Paris rose 0.6 percent, a day after losing more than 9 percent for its worst decline ever. The DAX in Frankfurt fell 1.1 percent on continuing concerns about the European economy.

Asian shares ended mixed, with the Nikkei stock average in Tokyo declining 3 percent. The benchmark index fell Tuesday below 10,000 points for the first time in five years, hit by worries about global growth prospects and the rapid surge in the yen. It recovered some of its losses after the move by the Australian central bank, but its closing level of 10,155.90 was the lowest since December 2003.

The Shanghai composite index slipped 0.7 percent, and stocks fell more sharply in Bangkok, Indonesia and Manila. But the S.& P./ASX 200 in Sydney posted a 1.7 percent gain after the Reserve Bank of Australia cut its main rate to 6 percent.

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More to come...