This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Cramer's Action Alerts PLUS - See his portfolio and get alerts BEFORE every trade. Learn more NOW!

Dow Drops 213 Points on Europe Debt Fears

NEW YORK ( TheStreet) -- Stocks decayed throughout Tuesday's session and the Dow closed below the 11,000 mark, as investors sold off on fears of a contagion spreading throughout Europe after Standard & Poor's downgraded Greek debt to junk status and docked Portugal's rating down by two notches.

The Dow Jones Industrial Average plunged 213 points, or 1.9%, to 10,992. The S&P 500 slid 28 points, or 2.3%, to 1184, and the Nasdaq shed 51 points, or 2%, at 2471.

U.S. stocks tumbled deep into negative territory, spurring a flight to safe assets as Standard & Poor's downgraded Greece's debt to junk status and lowered Portugal's credit rating by two notches to A- from A+.

"Everyone has a fear it'll trigger some kind of reaction, like it's the subprime mortgage crisis of Europe. There's the Goldman (GS - Get Report) overhang as well and the two are combining to lead the market lower ," said Doug Roberts, chief investment strategist at, who noted the market's recent run up as further incentive for profit-taking. "We thought we had this thing kind of stabilized, and all of a sudden it's popping. We thought this thing was coming to an end, but now it's like waiting for another shoe to drop."

Overseas, Hong Kong's Hang Seng fell 1.5% while Japan's Nikkei rose 0.4%. The FTSE in London lost 2.6%, and the DAX in Frankfurt shed 2.7%.

Peter Cardillo, chief market economist at Avalon Partners, acknowledged that the market is ripe for a pullback but believes Greek contagion fears will only exert short-term pressure on the market.

"Earlier we had strong consumer data and good earnings reports from Ford (F - Get Report), DuPont (DD - Get Report) and UPS (UPS - Get Report), but even more important is what these companies have been saying about the strength of the economy," Cardillo said. "Even these downgrades eroded earlier gains, we have Fed decision tomorrow afternoon, which may rephrase the 'extended period language' and give a better assessment of the economy. Plus we have the GDP report on Friday," he said, adding, "I just don't think the market is ready to move into a steeper pullback. I think this weakness will probably be short-term."

Goldman Sachs executives are testifying before the Senate Permanent Subcommittee on Investigations during a hearing on the firm's role in the financial crisis.

Late Monday, Democrats failed to get the 60 votes needed to move forward with the financial reform bill .

1 of 5

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Try it NOW
Only $9.95
Try it NOW
14-Days Free
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
BP $41.28 -0.60%
DD $78.25 0.17%
F $16.12 0.56%
GS $189.87 0.11%
MMM $167.41 0.15%


DOW 18,130.22 +33.32 0.18%
S&P 500 2,101.01 +2.48 0.12%
NASDAQ 4,981.98 +14.8390 0.30%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs