Dow Jones drops below 10,000 on worries about Europe debt crisis
The Dow Jones Industrial Average dropped below the 10,000 mark Friday morning amid worries about the Europe debt crisis, following big losses on Thursday.
AP Photo/Richard Drew
Stocks fluctuated Friday on further worries about how Europe is handling its debt crisis.
The Dow Jones industrial average zigzagged in a tight range after making bigger swings that briefly sent it below 10,000 in the opening minutes of trading.
The volatility comes a day after major indexes posted their biggest declines in more than a year. That pushed the market to "correction" mode, having dropped more than 10 percent from their 2010 highs set last month.
Investors again looked to Europe for direction. The German parliament approved the country's share of a $1 trillion plan to help contain debt problems in the European Union but major stock indexes fell more than 1 percent in Europe. Traders are worried stronger countries like Germany and France will be saddled with heavy debts to help weaker EU countries.
The euro rose to $1.2567 from $1.2464. The 16-nation currency has been a big driver of trading for weeks but many traders have been skeptical that any advances will be short-lived.
World markets have been falling on concerns that European debt problems will upend a global rebound. The fear is that huge deficits in countries including Greece and Portugal will cause a wave of bad debt to race through the world's financial system. Even if that is prevented, the prospect of heavier borrowing and sluggish growth has traders concerned.
In midmorning trading, the Dow Jones industrial average fell 26.08, or 0.3 percent, to 10,040.42. The broader Standard & Poor's 500 index rose 0.79, or 0.1 percent, to 1,072.38. The Nasdaq composite index rose 1.08, or 0.1 percent, to 2,205.09.
The Dow tumbled 376 points Thursday. The Dow and broader indexes are now in correction territory by having dropped more than 10 percent from their 2010 highs last month. The drop has erased the gains major indexes had made in 2010.
Bond prices rose, extending Thursday's gains when investors dumped anything seen as risky, including stocks and commodities. The yield on the benchmark 10-year Treasury note, which moves opposite its price, fell to 3.16 percent from 3.22 percent late Thursday.
Crude oil dropped 64 cents to $70.16 per barrel on the New York Mercantile Exchange.