Stocks Fall 189 Despite Rate Cut

Alcoa offers dismal earnings report to start third-quarter season

By Nick McMaster, Newser Staff

Posted Oct 8, 2008 3:24 PM CDT

(Newser) – Stocks fell nearly 190 points in a volatile day, with investors showing mixed opinions on whether an unprecedented global rate cut by the Fed and foreign central banks would help the credit crisis. After swinging in a 433-point range, the Dow closed down 189.01 points at 9,258.10, MarketWatch reports. The Nasdaq lost 14.55 points, closing at 1,740.33, and the S&P 500 fell 11.29 points to 984.94.

The coordinated rate cut is a largely symbolic gesture, some traders argued, because the credit crisis has decoupled the link between credit availability and price as firms struggle to evaluate their own complex credit bets. Third-quarter earnings season started on a bleak note as Alcoa halved its profit from a year ago and issued a poor outlook for the next 3 months. Alcoa shares fell 11.79%.

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Specialist Jennifer Klesaris studies her monitors as she works on the floor of the New York Stock Exchange, Wednesday, Oct. 8, 2008. (AP Photo/Richard Drew)

Trader Michael Berger works on the floor of the New York Stock Exchange, Wednesday Oct. 8, 2008. (AP Photo/Richard Drew) (AP Photo/Richard Drew)

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Today we've had an international rate cut, which is kind of unheard of in the past, so it's kind of stunning that we're not up 500 points. There is some killer volatility, - Robert Olman, Alpha Search Advisory Partners

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Stocks Fall 189 Despite Rate Cut