The Federal Reserve's Open Market Committee also released minutes from its latest meeting. The minutes indicated the central bank expects GDP to be flat for 2008, down from a previous estimate of 0.3% growth. The FOMC notes also said that additional interest-rate cuts may be necessary and indicated that the Fed would continue to do whatever is needed to aid the economy.
Few stocks remained afloat in the wash of negative sentiment.
Contributing to investor fear was the hobbled automotive sector. After arriving hat in hand on Capitol Hill Tuesday to plead their case for access to federal funding, chief executives of the woebegone companies General Motors (GM - Get Report), Ford (F - Get Report) and Chrysler were attempting again Wednesday to exchange a grilling by members of Congress for billions of dollars in government aid. The Big Three have been walloped lately by a combination of flagging sales, troubles in their finance divisions and high labor costs.
GM shares plummeted 9.7% to $2.79, and Ford tanked 25% to $1.26.