Dow Drops 508 Points

Fed's attempts to help do nothing for equities in the short term
By Nick McMaster,  Newser Staff
Posted Oct 7, 2008 3:31 PM CDT
NEW YORK - OCTOBER 07: A bronze statue of a bull fighting with a bear is displayed at the Museum of American Finance October 7, 2008 on Wall St. in New York City.   (Getty Images)
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(Newser) – Stocks plummeted today, as actions by the Federal Reserve to prop up the commercial-paper market and hints of an interest-rate cut from Ben Bernanke failed to restore investors’ confidence, the Wall Street Journal reports. The Dow fell 508.39 to 9,447.11. The Nasdaq shed 108.08, closing at 1,754.88, and the S&P 500 lost 60.66 to settle at 996.23.

Financials led stocks lower, soured in part by rumors that Mitsubishi-UFJ may renege on its agreement to buy a stake in Morgan Stanley. The bank denied the reports, but its shares fell 25% anyway. Alcoa is set to kick off the third-quarter earnings report season after the bell today, and traders fear that a series of bleak updates will depress equities even further.