Whipsaw Day Caps Dow's Worst Week Ever

Updated from 4:08 p.m. EDT

A rally effort in the final hour of trading on Wall Street pulled stocks higher to end a chaotic Friday with mixed results. At the center of the whipsaw session was the fate of the financial system, which has been buckling as credit markets remained frozen and financial firms got pummeled.

The Dow Jones Industrial Average swung violently throughout the session. The Dow suffered a sharp selloff of nearly 700 points early in the session to fall briefly below 8000 for the first time in more than five years. It heaved briefly into positive territory two times, before ending the day down 128 points, or 1.5%, at 8451.19. The S&P 500 lost 10.7 points, or 1.2%, at 899.22. The Nasdaq gained 4.39 points, or 0.3%, at 1649.51.

For the week, sellers dominated the charts as the Dow dropped 18%, the S&P lost 18% and the Nasdaq dropped 15%.

Amid the increasing concern about banks, the U.S. government was considering guaranteeing bank debt and insuring all domestic bank deposits, according to a report in The Wall Street Journal.

Friday afternoon, the finance ministers from the Group of Seven industrial nations held a meeting in Washington. The economic powers plan to discuss a coordinated response to the global credit crisis. Japan's finance minister, Shoichi Nakagawa, said that his country would propose an international fund to secure emergency loans for nations suffering under the credit squeeze.

"Because this is a global banking crisis, you've got to come up with a global plan to backstop everyone," said Paul Mendelsohn, chief investment strategist at Windham Financial. "This is a real financial panic. The run on the money markets is the equivalent of a run on the bank."

« Previous Page

1 2 3 4 5

Next Page »