Dow drops 634 points after S&P downgrade
August 8th, 2011
04:16 PM ET

Dow drops 634 points after S&P downgrade

[Updated at 4:16 p.m.] The Dow Jones Industrial Average has suffered its worst one-day loss since December 2008, plummeting 634.76 points - to 10,809.85 - after S&P downgraded its rating for U.S. credit.

Monday's preliminary figure, after trading ending at 4 p.m. ET, represents a one-day loss of 5.5%. The Dow is below 11,000 for the first time since November.

The S&P 500 fell 6.6% and Nasdaq Composite was down around 6.9%.

[Updated at 2:27 p.m.] Dow extends loss to 600 points as stock sell-off accelerates.

[Updated at 2:03 p.m.] Dow drops 450 points, falling below 11,000 for first time since last November, as sell-off extends.

[Updated at 1:57 p.m.] President Barack Obama said Monday that the downgrade of the U.S. credit rating by Standard & Poor's occurred because "they doubted our political system's ability to act."

[Updated at 10:33 a.m.] Stocks extend losses after Mortgage finance agencies Freddie Mac and Fannie Mae were downgraded by S&P, following downgrade of the United States. Dow falls more than 300 points.

[Updated at 10:09 a.m.] U.S. stocks plunged Monday as Wall Street had its first opportunity to react to Standard & Poor's downgrade of U.S. debt.

The Dow Jones industrial average was down 203 points, or 1.8%; the S&P 500 lost 25 points, or 2%; and the Nasdaq Composite dropped 58 points, or 2.8%.

Monday's selloff was broad, with 28 out of the Dow 30 and 495 members of the S&P 500 trading in the red. The blue chips were dragged lower by a 8% drop in Bank of America shares and a 4% decline in shares of Alcoa. Track the markets

[Posted at 9:12 a.m.] U.S. stocks were set to tumble at the open Monday, tracking deep declines in global markets, as investors get their first opportunity to react to Standard & Poor's downgrade of U.S. debt.

S&P 500 and Nasdaq futures were all down more than 2% ahead of the opening bell. Dow Jones industrial average futures were less than 2% lower. Stock futures indicate the possible direction of the markets when they open at 9:30 a.m. ET.

Late Friday, S&P downgraded United States' credit rating by one notch to AA , removing it from the Triple A-club for the first time in history.

Economists and investment strategists largely agree that there could be an initial shock, but the downgrade itself should not impact markets too much.

Still, the rating cut is unprecedented, so nobody can be certain.

Fortune: Wall Street to investors: Don't panic

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Filed under: Business • Economy • Finance
soundoff (206 Responses)
  1. Bull Halsey

    I want to know why George Soros closed his hedge fund to new investors.

    August 9, 2011 at 2:45 am | Report abuse |
  2. Nicole NY

    CNN and ALL of its Programing Contributors – you are to blame for failing to hold accountable the Republican politicians that openly wanted a U.S. default!!! The media failed to repeat this fact and instead blamed the President and Congress generally for one groups failure to negotiate. It is shameful that CNN does not stick to the facts!! Instead the reporting attempts to report a "shared blame' approach for the sake of seeming balanced – when the facts do not support such reporting. You are doing the American people a disservice because doing so fails to adequately inform the electorate who is most responsible for the American economic crisis – that has now turned into a world economic crisis by a select group of Republican politicians. We will never be able to solve our governance problem without FACT reporting regardless of seeming balanced to one party or the other. IT IS IMPARATIVE TO THE AMERICAN PEOPLE – YOU EDUCATE NOT ENTERTAIN!!!! Please get it right.

    August 9, 2011 at 3:57 am | Report abuse |

      That was well stated, Nicole. Thank you.

      August 9, 2011 at 4:50 am | Report abuse |
  3. sarinastadle

    S&P 500 Reports: Stocks Down as DOW Falls Beyond -300

    August 9, 2011 at 5:00 am | Report abuse |
  4. Spiderman

    I will raise the Dow by 1200 points within 3 days.

    August 9, 2011 at 8:16 am | Report abuse |
  5. s kel

    bull 1st of all you discredit the name of a great ww2 navy adm. Of pto 5th fleet. 2nd you are typical blind,bull headed.stupid, narrow minded right wing tea crapper who whem presented facts: duh masters in fire sci. I must be working as a first responder, yes responded to pentagon on my own on 9 11 ,joined up with my unit there. but your narrow minded self thinks if i dont agree with you I must be on welfare. What a typical stupid tea bagger u are.

    August 9, 2011 at 10:10 am | Report abuse |
  6. Scarlet

    @ s kel:
    Darlin'–would you mind if I pointed out to you that you would have just infinitely more credibility if you just made the extra effort to punctuate?

    August 9, 2011 at 10:23 am | Report abuse |
  7. Bull Halsey

    S kel is nothing more than a night shift security GUARD.

    August 9, 2011 at 10:42 am | Report abuse |
  8. s kel

    scarlet once more to hell with the grammer, as i said before if you ignore the you ignore the content like you have , that in itself shows the narrowness of your thinking. typical tea bagger. And to bull no stupid, im a firefighter/paramedic and quickly typing this on a very small screen touch phone. but your to stupid to remember that and your narrow mind justs goes on commimg up with fox news type lies to make yourself feel better. and btw stupid , there are highly trained and paid security personal.

    August 9, 2011 at 12:14 pm | Report abuse |
  9. s kel

    amd ill ill keap making gramatical eerrors. read thru them like iii duu. Okey?? Its a damn shame the narrow thought process of some people.

    August 9, 2011 at 12:22 pm | Report abuse |
  10. Bull Halsey

    @s kel: I dont think you finished grammar school.

    August 9, 2011 at 1:48 pm | Report abuse |
  11. Georgia

    Is there any way we can put Stupid & Poop's out of business because that's what needs to happen to them right now. Who pays them, anyway? Whoever it is, they should stop immediately. What a total bunch of idiots they are. There is absolutely no safer organization in the world with which to trust your money than the United States, and everyone with even the tiniest brain knows that, which means those dumb-poops at Stupid & Poop's must not have any brains at all, and they certainly have no loyalty to this country.

    August 9, 2011 at 4:05 pm | Report abuse |
  12. s kel

    bull go and take your family, including all of the tea party ,and please please go back home..... straight to hell! nothing more, nothing less....

    August 9, 2011 at 9:27 pm | Report abuse |
  13. Christopher Dycha

    Fight the urge to be impulsive as the news would try to steer us with their minute by minute newsflashes. The reason why our grandparents had a retirement fund and savings was because they were consistent with doing the little things right by saving every day. We forgot that proven strategy by wanting the homerun now. While not exciting or flashy, steady wins the race folks. Christopher Dycha

    August 13, 2011 at 9:12 am | Report abuse |
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