200809302129 | Wall St on rollercoaster slide after Us Lawmakers reject 700bn rescue

Wall St on rollercoaster slide after Us Lawmakers reject 700bn rescue

New York - US wall street stocks suffered their worst single-day slump on monday after US lawmakers rejected a $700bn rescue of the financial system. The Dow Jones Industrial Average sank 770.59 points (6.92%) to 10 372.54 after the closing bell in the worst single-day point decline ever, based on provisional data at the close of trade.

The slide eclipsed a 684-point drop on September 17, 2001, when the markets reopened following the September 11 terror attacks.
The market bloodbath sent the Nasdaq down 199.61 points (9.14%) to 1 983.73 and the broad-market Standard & Poor's 500 index lower by 104.39 points (8.64%) to a preliminary close of 1 108.22.

Markets went into panic after the House of Representatives rejected a fragile compromise plan to spend up to $700bn to revive a financial sector weakened by a US housing meltdown.
"The important question is whether the system can save itself before the (Dow) moves toward 9 000," said Douglas McIntyre at 24/7 Wall Street. "That would wipe out over five years in gains."

Crude oil plunged more than $10 a barrel as investors scrambled in the face of panicked markets.
New York's main contract, light sweet crude for November delivery, tumbled $10.52 a barrel to close at $96.37.

"It is unclear what the next step will be. It took days of painstaking negotiations to put together the deal, and congressional leaders and administration officials may have to go back to the drawing board," said Augustine Faucher at Economy.com.

"The US is looking at a severe recession if Congress fails to pass some sort of package."

US President George W. Bush said on Monday He was livid that the House of Representatives voted down a $700bn plan to rescue the financial system but said he would continue to confront the problem head-on.

"I was disappointed in the vote that the United States Congress (had) on the economic rescue plan," Bush told reporters after a meeting with Ukraine President Viktor Yushchenko.

"We put forth a plan that was big because we've got a big problem.