NEW YORK (CBSNewYork/AP) — The stock market piled on more losses Friday as investors began seeking the safety of cash or bonds ahead of the weekend.
The Dow Jones Industrial Average closed down 171 points Friday, putting an end to an up-and-down week on The Street.
The major indexes had fluctuated in a narrow range after Thursday’s 419-point plunge in the Dow Jones industrial average. There was little news to help investors determine their next moves. But some traders did not want to take the chance of holding stocks if one of their biggest concerns, the European debt situation, worsened over the weekend.
“These things usually break out over the weekend and then you have a mad dash Monday to react to them,” said Mike McGervey, the head of McGervey Wealth Management.
The drop late in the day recalled the 2008 financial crisis. Then, many investors stepped up their selling on Friday afternoons out of fears that another bank might fail over the weekend — as Lehman Brothers did on Sunday, Sept. 15.
The Dow’s drop was due in part to Hewlett-Packard Co., which plunged 21 percent. The company said Thursday that it will close its mobile business, sell or spin off its PC business and pay $10 billion for a business software company.
The most notable economic news Friday came from JPMorgan Chase & Co. The bank joined other financial firms and cut its forecast for economic growth during the fourth quarter. It’s now predicting growth of 1 percent, down from an earlier forecast of 2.5 percent.
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Financial markets have been extremely volatile for weeks over fears of a new U.S. recession and a global economic slowdown.
Meanwhile, Mayor Michael Bloomberg warns the rollercoaster stock market is sending a message that investors are worried about Europe’s enormous financial problems and the way the federal government is handling our own finances.
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“The public is upset,” he said. “You see it in the markets and the markets can destroy wealth, they can create wealth but more importantly, they’re telling you about confidence in the future. The indicators, what they’re telling you is very worrisome.”
Bloomberg said one can only hope that Washington gets the message.
What do you make of the market’s performance today? Sound off below in our comments section…
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