01 December 2008 22:13 [Source: ICIS news]
HOUSTON (ICIS news)--The Dow Jones Industrial Average fell by 680 points on Monday, wiping out all the gains it made during the week before.
The index opened at 8,617, a 212 point drop from Friday’s close, and steadily glided down from there to end the day at 8,149, a 7.7% loss.
The fall came amid a slew of bad economic news for the US.
The Institute of Supply Management, which measures manufacturing activity in the US, on Monday said manufacturing was at a 26-year low. Its monthly index was worse than economists’ expectations, according to a survey by Thomas Reuters.
The National Bureau of Economic Research’s seven-member Business Cycle Dating Committee said December 2007 marked the ?xml:namespace>
“The peak marks the end of the expansion that began in November 2001 and the beginning of a recession,” the group said in a statement. “The expansion lasted 73 months; the previous expansion of the 1990s lasted 120 months.”
The committee said its definition of a recession differed from the more commonly held definition of two consecutive quarters of decline in real GDP.
A recession is a significant decline in economic activity spread across the economy, lasting more than a few months, normally visible in production, employment, real income and other indicators, the committee said.
Investors worried that sales during the Thanksgiving holiday weekend, traditionally the busiest shopping days of the year, were low. US consumers are the main engine for the US economy.
ShopperTrak, an organisation that measures retail sales at 50,000 stores in the country, said US shoppers spent $10.6bn (€8.4bn) on 28 November, an annualised sales increase of 3% over last year, but released no information for the rest of the weekend.
Shares of chemical industry bellwether Dow Chemical ended the day at $17.93/share, down 62 cents/share, or 3.3%, from Friday’s close.
($1 = €0.79)
Additional reporting by Brian FordTo discuss issues facing the chemical industry, go to ICIS connect
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