Wall Street ends worst quarter since
2008
Written by Reuters
Saturday, 01 October 2011 10:14
NEW YORK: Stocks ended their worst quarter since the depths of the 2008 credit crisis, crippled by Europe's debt debacle, a U.S. credit downgrade and a sputtering global economy.
A steep slide on Friday, Sept 30 closed out a fifth month of losses as weak economic data from China sparked fears of a global economic slowdown while investment bank Morgan Stanley plummeted on concerns about its exposure to European banks.
The S&P 500 index has lost more than 14 percent this quarter and over 7 percent in September alone. As of Thursday, Wall Street's deep downturn in the third quarter wiped out $2.2 trillion of the Wiltshire 5000 index -- the broadest measure of U.S. stocks.
"Why is the market so soft and so weak? Because '08 is still fresh in people's memories," said Joseph Mazzella, a senior trader at Knight Capital in Jersey City, New Jersey.
Stocks have been battered by the threat of a slowdown and fears that a Greek debt default could spark a credit shock similar to that caused by Lehman Brothers in September 2008, sending markets into a tailspin.
Fears of a hard landing in the world's second largest economy joined the potent mix troubling investors after China's manufacturing sector shrank for the third month in a row.
HSBC's China flash purchasing managers index showed the longest contractional streak since 2009 in a worrying sign for the world economy, which has looked to China as a rare source of expansion.
"The economic engine that has been driving growth has been China and if that comes undone, it gets scary again," said Mazzella. |
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