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Global stock
markets take
a pounding

The Dow, following bad days
in Europe and Japan, falls
below 10,000 amid fears
of economic chaos

---

By Amy Baldwin
Associated Press

NEW YORK -- Stocks plunged again today, sending the Dow Jones industrials below 10,000 as fears of a global economic slowdown swept across Wall Street. The drop followed nose-diving prices overseas as investors found no reason to buy.

"You are in the vicious cycle now," said Gary Kaltbaum, a technical analyst for First Union Securities. "It's where we close bad, and then Japan has a bad night, and then the European markets open lower, and we follow them."

The Dow, which dropped 317.34 to 9,973.46, earlier fell as much as 395 points to the 9,895 level. It was the first time since Oct. 20 that the blue chips have traded below 10,000. The losses easily wiped out yesterday's 82-point advance and compounded Monday's 436-point drop. The Dow is now down 6.3 percent for the week, its worst percentage decline since it fell 7.5 percent for the week of Dec. 4, 1987.

Broader market indicators also skidded. The Nasdaq composite fell 42.76 to 1,972.02 while the Standard & Poor's 500 index tumbled 30.95 to 1,166.45.

Declining issues outnumbered advancers more than 3 to 1 on the New York Stock Exchange. The NYSE composite index lost 15.58 to 593.76, the American Stock Exchange composite index fell 18.07 to 887.14, and the Russell 2000 index dropped 7.25 to 455.01.

While sellers have dominated the U.S. stock market recently, believing that poor earnings and the weakening economy in this country won't recover in the near future, the prospect of economic crises in other countries, especially Japan, unnerved investors around the globe.

"You put all that together and this is more than the market (here) could take," said Charles Pradilla, chief investment strategist at SG Cowen Securities.

The decline began as soon as the market opened with the Dow quickly losing more than 300 points in a matter of minutes.

Investors, already struggling with a bleak outlook for U.S. corporate profits, were further shaken by news from Japan yesterday, when the government admitted that the world's second-biggest economy is in a state of deflation. For months, Japan has been downplaying the possibility of deflation, an economic situation that can lead to recession.

The newest big fear on Wall Street is that Japan's economic problems will cut into demand in that country for U.S. goods and services.

U.S. financial stocks suffered after 19 Japanese banks were placed on "negative watch" by an international rating agency.

Stocks fell hard in Europe. The markets in Paris, London and Frankfurt were each off upwards of 3.5 percent.