NEW YORK (AP) — Wall Street tumbled yesterday as further troubles in the financial sector, higher unemployment and lackluster retail sales touched off fresh concerns about the economy. The Dow Jones industrials skidded nearly 225 points, while bond prices shot higher as investors once again sought the safety of government debt.
The stock market's pullback erased most of the 370-point gain the Dow logged the prior two sessions and shows the lack of solid conviction behind many of investors' recent bets.
Heading the list of worries, insurer American International Group Inc. reported a loss of more than $5 billion for the second quarter and the Labor Department said the number of newly laid off people seeking jobless benefits last week jumped to its highest level in more than six years.
Bill Stone, chief investment strategist for PNC Wealth Management, said the stream of economic news has been somewhat negative lately, often short-circuiting the market's attempts to build on rallies. Yesterday's reports on employment and financials only added to the uneasiness, he said.
"The concerns about a weakening economy always run to worries about the financials and then you add some negative news to them on their own and you've got what we've got today," he said.
The Dow fell 224.64, or 1.93 percent, to 11,431.43. It was the Dow's sixth triple-digit move in the past two weeks, illustrating how commonplace big swings in the indexes have become amid investors' uncertainty about the economy.
