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Closely-Watched US Stock Market Index Slumps to Five-Year Low

It was another down day on Wall Street Wednesday as the Dow Jones Industrials lost 514 points amid growing worries of world recession. VOA's Barry Wood has more.

In addition to the Dow Industrials being down, the broader Standard and Poor's index of 500 stocks fell six percent to 897. That is the lowest close in the S & P since April 2003. The slump in equity prices was global as the market index in London was off 4.5 percent and Tokyo was down nearly seven percent.

In Latin America markets were unsettled by a move by Argentina's government to nationalize the privately run pension funds. The Buenos Aires stock index was off ten percent, while Chile's index fell six percent and Brazil's ten percent.

The weakness in the U.S. economy was reflected in a 70 percent jump in home foreclosures in the third quarter. Data from RealtyTrac says three quarters of a million homes received foreclosure notices in the July to September period. About three million homes are expected to be in foreclosure this year.

Mark Zandi, chief economist at Moody's, says the deepening U.S. recession already is impacting 28 of the 50 US states, making it problematic for workers to move from a depressed area to one where conditions are better. "People can't move. They don't know where to go. In the last recession California got creamed and everybody moved to Las Vegas (Nevada) or Phoenix (Arizona) or Seattle (Washington). But in this recession it's not clear where you would go, except maybe to Texas (which is doing better)"

Oil was down again Wednesday, falling $5 to under $67 a barrel. Oil has fallen by 50 percent in just three months. Gold lost $35 to $733 an ounce. The dollar continued to rally and closed at $1.28 against the euro while the British pound fell to a five-year low of $1.63.