Dow closes down 778 points on bailout failure

29 September 2008 22:22  [Source: ICIS news]

HOUSTON (ICIS news)--The Dow Jones Industrial Average (DJIA) fell more than 750 points on Monday, by far the index’s biggest one-day drop ever, after the lower chamber of the US Congress voted down a $700bn (€476bn) bailout bill.

Stocks started their downward plunge early in the day, reaching a loss as low as 400 points before the US House of Representatives voted 228-205 against the bailout. Stocks then went into a free fall after news of the vote reached Wall Street.

The loss of 778 points, or about 7%, was the single biggest one-day loss in terms of points for the Dow in its history. The previous record, a one-day loss of 509 points, happened earlier this month. Proportionately, Monday’s losses were not as vast as the 508 point loss on Black Monday in October 1987, when the market lost more than 20% of its value.

Chemical companies were hit along with the rest of the financial world.

Shares of Huntsman, already battered by an ongoing legal dispute with Hexion Specialty Chemicals, fell $1.26, or almost 15%, to close at $7.35/share.

Dow Chemical lost $3.01, or nearly 9%, to close at $30.96/share.

Potash Corporation of Saskatchewan (PotashCorp), pushed downward by the economic crisis and falling corn values on the Chicago Board of Trade, lost $16.95, or more than 11%, to close at $130.60/share. Monday’s closing value was 40% less than the company’s all-time record of $241.62/share, set in June.

Johnson & Johnson, one of the 30 companies that make up the DJIA, lost $1.82/share, or nearly 3%, to close at $67.58.

Meanwhile, collapsing crude oil values – which lost more than $10/bbl on Monday on the NYMEX – hit ExxonMobil, which lost $6.69, or more than 8%, to close at $73.96/share.

($1 = €0.68)

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By: David Rosen
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