Dow Recovers After 343-Point Decline

U.S. markets initially sold off solidly with the Dow posting an intraday loss of over 300 points when government reports were released showing bigger than expected drops in July housing starts and building permits as well as a bigger than expected increase in weekly jobless claims. The data has added to the recent concerns that problems in the credit markets could impact the economy as a whole.

The markets have had a volatile final hour over the past week and today's strong 200 point last hour rally was no exception. The Dow ended the day flat, while the S&P 500 gained 0.4% and the Nasdaq lost 0.3%.

Crude oil futures for September delivery fell 3.2% to $70.98 a barrel. Gold futures for December delivery fell 3.2% to $658.00 an ounce, the largest drop in over a month.

Around Europe, Germany's DAX fell 2.4% to 7,270.07, France's CAC 40 index dropped 3.3% to 5,265.47, and Britain's FTSE 100 index lost 4% to 5,858.90.

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Darren Wong
Associate Editor
darrenw@tradingmarkets.com

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