Stocks Plunge Precipitously But Back Off Worst Losses As Oil Prices Tumble

NEW YORK (CBSNewYork/AP) -- U.S. stocks recovered much of an early plunge Wednesday, but the price of oil suffered its worst one-day drop since September.

Energy companies were pummeled as the latest fall in oil threatened more damage to an industry that has been stricken with bankruptcies, layoffs and other cutbacks.

Exxon Mobil fell 4 percent and Chevron fell 3 percent.

Crude fell below $27 a barrel, the lowest price since May 2003 and a far cry from the $100 a barrel it fetched in the summer of 2014.

Greater supply and less demand, however, means some good news: lower prices at the pump. The national average is well below the $2-a-gallon mark.

The Dow Jones industrial average fell 249 points, or 1.6 percent, to 15,766. It was down as much as 565 earlier.

The Standard & Poor's 500 index lost 22 points, or 1.2 percent, to 1,859. The Nasdaq composite slipped five points, or 1 percent, to 4,471.

Global worries remained focus on China. The Shanghai Composite has dropped by more than 40 percent since last summer.

Chinese officials say their economy is transitioning to less dependence on exports, creating instability.

So the rest of the world has to get used to volatilities coming out of China," said Fang Xinghai, vice chairman of China Securities Regulatory Commission.

And that volatility continues to trigger global sell-offs.

"This is the new normal," Stephen Guilfoyle, a trader at the New York Stock Exchange, told CBS2's Dick Brennan.

"You probably don't want to check your balances every night because it's going to put you in a bad mood," Guilfoyle added.

The big questions: When do we hit bottom? And how long will the instability last?

Analysts say the selling is based on fear, but at least not panic.

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