Wall Street Cut by Credit Crunch

Updated from 1:56 p.m. EDT

Stocks on Wall Street partially resolved violent morning volatility by entrenching themselves deep on the downside Friday as credit crisis-induced fears continued to weigh on investor sentiment.

Trading remained choppy. The Dow Jones Industrial Average plummeted nearly 696 points early and briefly broke below the 8000 level, only to recover just as sharply and briefly touch positive territory. Lately, however, the index was trading down 435 points at 8145. The S&P 500 was lately down 54 points at 856. The Nasdaq was 81 points lower at 1564.

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. ...