Updated from 2:21 p.m. EDT
Ugly Start to the Week
At 5:30 p.m. EDT
Let's start with the good news. The
finished Monday about 85 points above its session low, and not every stock fell.
Now the bad news. The index ended down 254.16 points, or 3.3%, at 7522.02, and 28 stocks did in fact decline.
Johnson & Johnson
managed to escape the selling that opened the new week, and that was just barely as each rose less than half a percent.
Elsewhere it was a rough day.
was the hardest hit, sinking 25.4% to $2.70 amid renewed concerns about the future of the Detroit automaker.
Bank of America
lost 17.9% to $6.03, and
slumped 14.2% to $6.69.
lost more than 11%.
Due to the way the DJIA is calculated, the biggest drags on a point basis were
, who each accounted for more than 20 points of the drop.
That performance cut the Dow's month-to-date gain to 6.5%, and it meant more than $80 billion in market cap disappeared. The upside is that it's Monday, and we all know Monday is the worst day of every week. Right?
Is It Friday Yet?
At 1:50 p.m. EDT
Pretty brutal day for the
. With about two hours left in the session, the index is down 302 points at 7474, a decline of 3.9%.
All 30 stocks were weaker, led by a 21% drop in
to $2.87. Also falling hard were
Bank of America
, sliding 15.3% to $6.22, and
, down 12.4% at $6.83.
was dropping 10%.
If you think back over the last couple of years of the financial crisis, we've had days where it seemed like the end of the world, or at least capitalism, had arrived. Even though the bears have the headlines and the fear of the unknown working in their favor right now, this selloff doesn't feel like that to me.
The situation at GM is dicey, but the company is going to continue existing, at least for the foreseeable future. If the government weren't planning on keeping it alive, it wouldn't be mandating a change at the top. Of course it's not going to be an easy situation to fix, as several months of trying have shown.
Now the common stock is a different matter. If you weren't questioning the value there before, you certainly have to now. Obviously the stampede toward the exit tells you how most shareholders feel today. Hard to be excited about owning a company's common when people are talking about
Private Enterprise Needs a Friend
At 9:35 a.m. EDT
Here's a short list of the things working against the
Dow Jones Industrial Average
as we get this new week started:
- We've come out of a three-week span that at one point had the index up more than 20% from its March 6 low, and we're probably due to give some of that back.
Bankruptcy talk has returned for
General Motors (GM) - Get Report, which has a new CEO and chairman now that Washington has forced out
Timothy Geithner says some banks are probably going to need more government aid.
Discussions about new regulations from the
G-20 nations that will have to be monitored in the coming days.
In short, sellers have an opening, and the Dow was sinking 200 points in the early going.
GM was down 21% early to $2.87.
was tumbling 11.5% to $2.32.
Bank of America
was falling 8.3% at $6.73, and
was losing 4.7% to $26.10.
The good news is that we can be confident many of the companies we know in the DJIA will continue to exist in some form. The bad news is we're being reminded again that they might eventually be divisions of the U.S. government.