International sell-off hits U.S. stock market

Updated

The U.S. stock market got off to a bad start this morning. The Dow Jones Industrial Average and the Nasdaq didn’t drop as much as some had feared, but there are clear signs that the turmoil will continue — and its effects will be global.

American anxiety was spurred by sharp drops in Europe and Asia, which in turn were caused by a stream of bad financial news. In Japan, for example, Sony cut its earnings outlook by more than half due to the weakening economy, while in Germany, Daimler reported lower third-quarter earnings. Japan’s Nikkei 225 fell to its lowest point since April 2003; the major exchanges in Tokyo, Berlin and and London all fell by at least 8 percent.

In premarket trading, futures on the Dow fell as far as they could go — after a 550-point drop, the market automatically freezes. Luckily, trading didn’t plunge stocks as badly as feared, and things are moving back up again. As of 9:40 a.m. pacific time, the Dow was down around 329 points (3.79 percent), while the Nasdaq was down around 49 points (3.05 percent). Most of the major tech stocks dropped too, with Google and Apple down about 3 percent, and Cisco down around 6 percent.

Update: The Dow closed 312 points down (3.52 percent), while the Nasdaq dropped 51.9 points (3.23 percent.)

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