Wall Street Saddled With Hefty Losses

Updated from 3:37 p.m. EST

Announcements of significant job cuts at major financial firms and weakening earnings outlooks from several big retailers brought unease to Wall Street Monday, and the major indices finished with losses as a pile of sell orders overtook the trading floors during the final minutes of trading.

The Dow Jones Industrial Average lost 223.73 points, or 2.6%, to 8273.58, and the S&P 500 sank 22.54 points, or 2.6%, to 850.75. The Nasdaq shed 34.80 points, or 2.3%, to 1482.05.

The major averages have been trading in a range for the past couple of weeks, and as they hit the lower end of that range, they could be due for a two- to three-day bounce, said Ryan Detrick, senior technical strategist at Schaeffer's Investment Research. He also noted that this is an options-expiration week, which has lately been bullish for stocks.

Although the market is showing fear, said Detrick, "We have not truly, in our opinion, seen the flush-out. ... It's scary when the market keeps going lower and people keep saying there's good buying opportunities." He said that a weak Christmas for the retailers is priced in to the market and in the coming months, investors will be looking for signs of improvement in the overall economy.

Detrick said that after substantial reductions in the target interest rate over the past year, investors will be checking to see that the Federal Reserve's intervention has actually helped the economy. "That's what we need for the market to really form a bottom," he said.