Stocks plunged Thursday on growing fears that the subprime mortgage market meltdown is creating a tighter lending environment, crimping leveraged buyouts and threatening to slow the broader economy.
Expedia , Daimler Chrysler
and Tyco
are some of the names that have run into financing difficulties in recent days, creating fear that the leveraged buyout craze that has fueled the stock market run-up could be over.
The result was the biggest drop for the major U.S. stock indexes since the Feb. 27 Shanghai market meltdown. The major indexes all lost about 2% on the day as trading volumes hit records and more than 80% of U.S. stocks ended the day lower. Only one of the Dow 30 — 3M — closed the day higher.
Apple and Baidu
were two standouts, however, soaring on better than expected results. F5
and Omniture
were other earnings winners.
But the list of stocks falling on their quarterly report cards was much longer. Akamai , Comcast
, E*Trade
, Level 3
, Micrel
, RightNow
, Sanmina-SCI
and Sonus
were all hit on their earnings reports.
Voltaire picked the wrong day to go public, losing 7% in its stock market debut.
The Nasdaq fell 49 to 2599, the S&P 500 tumbled 35 to 1482, and the Dow plunged 311 to 13,473. Volume soared to 6 billion shares on the NYSE, and 3.5 billion on the Nasdaq. Declining issues led by a 29-3 margin on the NYSE, and 25-5 on the Nasdaq. Downside volume was 94% on the NYSE, and 87% on the Nasdaq. New highs-new lows were 41-744 on the NYSE, and 64-373 on the Nasdaq.