Wall Street plunges as big bank earnings, stronger dollar weigh

08:12, January 21, 2010      

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Wall Street plunged on Wednesday after a series of banks reports showed the troubled sector was still struggling with consumer-related area, such as home loans and credit losses.

Bank of America reported a wider-than-expected quarterly loss, hurt by still-high loan losses and its repayment of the U.S. government bailout aid.

Morgan Stanley said it turned into profit in the last quarter of 2009. However, the results still missed market expectation.

A jump in the U.S. dollar also weighed on the market as global commodity prices came under pressure, dragging resource-related stocks down.

On the economic front, the Commerce Department said on Wednesday that housing starts dropped by 4.0 percent in December, bigger than expected, while building permits jumped 10.9 percent.

Investors were also worried that the move by China to restrict lending may cool off Chinese growth, which many analysts believe would upset the Chinese-led global growth.

The Dow Jones fell 188.48, or 1.76 percent, to 10,536.95. Broader indexes also traded lower. The Standard & Poor's 500 index dropped 19.05, or 1.66 percent, to 1,131.18 and the Nasdaq tumbled 46.13, or 1.99 percent, to 2,274.27.

Source: Xinhua
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