Dow tanks on Argentina debt default, other fears

Boston (July 31)  Financial markets went into a tailspin Thursday after Argentina defaulted on its debt, raising fears among skittish investors already fretting over weak corporate earnings growth, rising interest rates and an aging bull market.

Argentina's blue chip Merval Index was among the biggest losers, sinking nearly 7% — the equivalent of a 1,000-point drop in the Dow Jones Industrial Average.

The Dow sank 317.06 points to 16,563.30, a two-month low. The 1.9% drop is the blue chip barometer's third-biggest daily decline this year and the worst since a 267-point loss April 10. Selling intensified as selling momentum picked up in afternoon trading.

 Broader averages were also hit hard. The Standard & Poor's 500 fell 2% to 1930.67, a six-week low. The Nasdaq lost 2.1% to 4369.77 and the Russell 2000 was off 2.1% to 1148.

 With the losses, a five-month string of Dow and S&P 500 Index gains will end with July's last trading session.

European markets also fell sharply, with Germany's DAX index tumbling 1.9% to 9407.48, France's CAC 40 losing 1.5% to 4246.14 and Britain's FTSE index off 0.6% to 6730.11.

Source:  USAtoday