August 26, 2008
Markets Drop As Credit Concerns Remain
By TIM PARADIS
By Tim ParadisThe Associated Press
Stocks sank in light trading Monday as worries about American International Group Inc. touched off broader concerns that the deterioration of the credit markets will bring more big losses for financial companies.
The major indexes lost about 2 percent. The Dow Jones industrial average fell by nearly 250 points, erasing a gain of about 200 points from Friday. Bond prices also jumped as investors fled to the safety of government debt.
New York-based AIG was the steepest decliner among the 30 stocks that make up the Dow industrials after a Credit Suisse analyst cut his price target on the world's largest insurer and forecast steep losses for the third quarter.
"There's just too much uncertainty out there creating all this volatility," said Sean Simko, head of asset management company SEI Investments. "And what's adding to the volatility is we're entering this holiday period. The swings are exaggerated by the light volumes," he said.
The yield on the 10-year Treasury note fell to 3.79 percent from 3.87 percent. The dollar was mixed against other major currencies, while gold prices fell. Light, sweet crude rose 52 cents to settle at $115.11 per barrel on the New York Mercantile Exchange.
Originally published by BY TIM PARADIS.
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