Posted on October 3, 2011
HOUSTON (FTMDaily.com) — The Standard and Poor's 500 index fell to its 2011 low from the latest news in Greece's financial crisis; namely, Greece said it will not hit the deficit reduction targets in part of the agreement of its bailout deal.
The S&P index is the benchmark for most U.S. stock funds. Since its 2011 high on April 29, the index has fallen 19.4 percent. A 20 percent drop would signify the start of a bear market, ending a bull market that began in March 2009. The S&P 500 has gained 76 percent since then, including dividends.
The Dow Jones industrial average fell 258.08 points, or 2.4 percent, to 10,655.30. The S&P 500 lost 32.19, or 2.9 percent, to 1,099.23. That's below its closing low of 1,119 for the year, reached on Aug. 8.
Indexes measuring smaller stocks fell even more than the Dow and S&P, which are dominated by large companies. The Nasdaq composite slid 79.57, or 3.3 percent, to 2,335.83. The Russell 2000 index of small companies plunged 5.4 percent to 609.49.
Revived worries about Europe's debt problems brought the euro to a 9-month low of $1.32 versus the dollar. U.S. companies that rely on exports by making their products more expensive overseas could suffer from the stronger dollar.
U.S. stocks followed suit as European markets dropped, and Germany, France, and Spain experienced losses of 2 percent in their benchmark indexes.