Aug. 18, 2011 (Bloomberg) -- U.S. stocks slumped after Morgan Stanley cut its forecast for global growth and government data showed that jobless claims rose and consumer inflation accelerated more than forecast.
Bank of America Corp. (BAC) and JPMorgan Chase & Co. (JPM) dropped more than 3.2 percent after Sweden’s financial regulator said his country’s lenders must do more to prepare for a worsening in Europe’s debt crisis that could freeze interbank markets and cut off funding.Caterpillar Inc. (CAT) and Ford Motor Co. (F) declined at least 4.4 percent, pacing losses in companies which are most- tied to economic growth. Alcoa Inc. (AA) and Exxon Mobil Corp. (XOM) retreated more than 2.3 percent as commodity prices sank.
The S&P 500 slumped 2.6 percent to 1,162.99 at 9:33 a.m. in New York. The Dow Jones Industrial Average fell 275.22 points, or 2.4 percent, to 11,134.99.
“It’s almost like a worldwide buyers strike,” Michael Mullaney, who helps manage $9.5 billion at Fiduciary Trust in Boston, said in a telephone interview. “There’s a continued general malaise on global economic activity. People continue to downgrade their expectations on growth on a worldwide basis. There’s concern about funding problems. That’s making us very nervous here and as such we want to take risk out of portfolios at least for the immediate future.”
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