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Stocks gasp at worldwide slowdown
By: cnn.comPosted On: 08/11/2010 3:31 P
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Stocks slid Wednesday after a wider U.S. trade gap and downbeat foreign data cast doubt on overseas demand for American goods.
Stocks slid Wednesday after a wider U.S. trade gap and downbeat foreign data cast doubt on overseas demand for American goods.
The Dow Jones industrial average (INDU) tumbled 222 points, or 2.1%, and the Nasdaq (COMP) sank 64 points, or 2.8%. The S&P 500 (SPX) fell 28 points, or 2.5%.
Earlier Wednesday, the government reported the trade deficit widened to $49.9 billion in June from a revised $42 billion the previous month. Economists surveyed by Briefing.com expected the balance to come in at $42.2 billion.
"[The] figures suggest the U.S. cannot rely on a boost from overseas demand to offset the current weakness of the domestic economy," Paul Dales, U.S. economist at Capital Economics said in a research note.
Ian Shepherdson, economist at High Frequency Economics, wrote that the trade figures were "spectacularly terrible."
Meanwhile, the Bank of England lowered its forecast for U.K. economic growth, and it said inflation is likely to be below the 2% target in 2012.
A raft of data from China reflected a mostly downbeat July -- inflation rates missed expectations, industrial production eased to the lowest level this year and retail sales slowed.
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