Stocks plummeted Wednesday, with the Dow industrials falling 449 points in its second worst session of the year, as the government's emergency rescue of AIG amplified fears about the stability of financial markets.The Dow Jones industrial average (INDU) lost 449 points, or 4% and fell to the lowest level since November 2005. The Standard & Poor's 500 (SPX) index lost 4.7% and fell to its lowest point since April 2005. The Nasdaq composite (COMP) lost 4.9% and ended at its lowest point since August 2006....
The selloff comes in the wake of the government's bailout of Fannie Mae and Freddie Mac, Lehman Brothers' bankruptcy, Merrill Lynch's sale to Bank of America and ongoing worries about Washington Mutual and other firms.
"There's a fear of a financial system meltdown going on, and it's grounded in the headlines we're seeing about the series of firms that are in trouble," said Paul Rabbit, president of Rabbit Capital Management.
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