Wall Street takes a dive to start the day, struggles to recover

U.S. stocks tumbled in morning trading Wednesday as investor fears of a global economic slowdown intensified, setting the Dow Jones industrial average on course for its fourth consecutive loss.

The Dow plunged as much as 369 points in the first 10 minutes of trading, following steep declines in Europe, as the market sized up a batch of discouraging data on retail sales and manufacturing.

The Dow recovered much of the ground it had lost in the first half-hour of trading.

The Dow was down 272 points, or 1.7 percent, to 16,042 as of 11:51 a.m. Eastern time Wednesday.

The Standard & Poor's 500 fell 32 points, or 1.7 percent, to 1,845. The Nasdaq fell 60 points, or 1.4 percent, to 4,167.

All three indexes are now negative for the year. The S&P is down 8 percent from its record high reached Sept. 18.

Bond prices soared as investors shifted money into safe-haven investments.

The yield on the 10-year Treasury note plunged to 2.03 percent from 2.20 percent Tuesday, a huge move.

Stocks have been declining for nearly a month as investors worry that economies in Europe and Asia are slowing. The Dow is now down 2.7 percent for the year, while the S&P 500 index and Nasdaq are barely in the green for 2014.

All 10 sectors in the S&P 500 declined, led by financial stocks. Bank of America fell 62 cents, or 3.8 percent, to $15.91.

The Commerce Department reported that retail sales declined 0.3 percent in September from the previous month as purchases of autos, gasoline, furniture and clothing slowed. Retail sales have risen 4.3 percent over the past 12 months, slightly below their historical pace.

A snapshot of manufacturing activity wasn’t encouraging either.

The Federal Reserve Bank of New York’s Empire State Manufacturing index fell 6.2 percent in October as new orders shrank and shipments barely rose. The latest reading marks the slowest pace of growth in six months.

In overseas market action, traders worried that Europe might relapse into recession.

France’s CAC 40 sank 2.8 percent and Germany’s DAX lost 2.3 percent. Britain’s FTSE 100 fell 2.3 percent. Greece’s stock index plunged 6.3 percent on concerns that the Greek government could collapse next year, putting its bailout program in danger. The index fell 5.7 percent the previous day.

In Asia, Japan’s Nikkei 225 stock average closed up 0.9 percent, while Hong Kong’s Hang Seng added 0.4 percent. China’s Shanghai Composite rose 0.6 percent and Seoul’s Kospi fell 0.2 percent after the central bank cut its growth forecasts for this year and next. Markets in Southeast Asia, Australia and New Zealand were higher.

U.S. crude fell 52 cents to $81.33 a barrel.

This story was originally published October 15, 2014 at 11:23 AM with the headline "Wall Street takes a dive to start the day, struggles to recover."