Pat Dollard

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“The plunge in the stock market follows last week’s massive 1,000-point surge on the Dow — its best weekly performance in 34 years.

Major indexes have lost about 10 percent since Barack Obama was elected president — a vote preceded by a steep rally — and the losses represent the Dow’s worst two-day percentage decline since the October 1987 crash.”

Fox Business:

Wall Street suffered its second straight selloff on Thursday after retailers issued the weakest sales reports this decade and as the markets brace for another ugly employment report due on Friday. The massive back-to-back waves of selling carved more than 900 points from the Dow, its worst two-day point decline in history.

Today’s Market

The Dow Jones Industrial Average lost 443.48 points, or 4.85%, to 8695.79, the broader S&P 500 dropped 47.89 points, or 5.03%, to 904.88 and the Nasdaq Composite slid 72.94 points, or 4.34%, to 1608.70. The consumer-friendly FOX 50 fell 35.76 points, 4.93%, to 688.95.

The two-day percentage drop on the Dow is the index’s steepest since October 1987 and comes after Tuesday’s election-day record 300-point surge. Analysts said the losses were in part a reaction to the election of Barack Obama — which was widely expected by Wall Street — and an indictment of the economic situation that will greet him when he takes office in January.

“Unfortunately that honeymoon period wasn’t very long,” said Art Hogan, chief market strategist at Jefferies & Co. “Obviously it’s a very historic time. We’ve got a president who’s going to hit the ground running. He’s also got historic problems in front of him.”

The plunge in the stock market follows last week’s massive 1,000-point surge on the Dow — its best weekly performance in 34 years.

Major indexes have lost about 10 percent since Barack Obama was elected president — a vote preceded by a steep rally — and the losses represent the Dow’s worst two-day percentage decline since the October 1987 crash.

Paper losses during that time in U.S. stocks came to $1.2 trillion, according to the Dow Jones Wilshire 5000 Composite Index, which represents nearly all stocks traded in America.

All but three of the 30 Dow components closed lower by at least 1%, led by double-digit plunges from General Motors (GM: 4.80, -0.76, -13.66%), aluminum maker Alcoa (AA: 10.26, -1.54, -13.05%) and American Express (AXP: 24.92, -2.91, -10.45%). Defensive names like Proctor & Gamble (PG: 63.35, -0.46, -0.72%), Coca-Cola (KO: 44.49, -0.24, -0.53%) and Wal-Mart (WMT: 53.49, -0.64, -1.18%) avoided those sharp declines but still closed lower.

There was little good news to reverse the selling trend Thursday. Major companies like tech bellwether Cisco Systems (CSCO: 16.94, -0.45, -2.58%), auto maker Toyota (TM: 67.09, -13.28, -16.52%) and FOX Business parent News Corp. (NWS: 8.31, -1.62, -16.31%) all warned of tough times ahead, and retailers issued the weakest results since at least 2000.

The commodities markets weren’t immune to the selling either as crude oil prices plunged more than $4 to the lowest level since March 2007, dragging down energy stocks like Chevron (CVX: 70.11, -4.77, -6.37%) and ConocoPhillips (COP: 49.11, -4.35, -8.13%). The price of a barrel of crude ended down $4.53 to $60.77.

Oil was pushed down on more fears about a global recession and a strong performance for the dollar, which gained about 1.5% against the euro. Also, the International Energy Agency slashed its global oil demand forecast for 2030 by 10 million barrels.

On the economic front, the government said initial jobless claims fell by 4,000 last week to 481,000. While the numbers were slightly better than expected, claims remained more than 50% higher than before the downturn and continuing claims jumped to 3.84 million — the highest level since February 1983.

Costco (COST: 53.51, -0.20, -0.37%) issued an unexpected October same-store sales decline while discount retailer Target (TGT: 35.47, -2.28, -6.03%) said sales fell by 4.8%, more than twice what was expected. Target also warned the “challenging sales environment” will continue into the holiday season and beyond. Other retailers like Abercrombie & Fitch (ANF: 26.55, -0.23, -0.85%) and Nordstrom (JWN: 15.23, -0.78, -4.87%) issued weak reports as well.

As a result, the Thomson Reuters same-store sales index plunged by a much worse-than-expected 0.7% — the weakest performance since the index began tracking results in 2000.

On the other hand, retail king Wal-Mart (WMT: 53.49, -0.64, -1.18%) beat expectations with 2.4% same-store sales growth in October and smaller retailers like Urban Outfitters (URBN: 18.25, -1.88, -9.33%) and Buckle (BKE: 24.89, +0.33, +1.34%) posted double-digit sales growth.