Wall Street gets crushed

The Dow finishes the day down 344 points - and for reasons that aren't entirely clear (aside from general worries about an economy that’s going nowhere fast). Traders are guessing at a few possibilities:

--Speculation that tomorrow's unemployment numbers for August will be stinkier than expected (the government reported that the number of Americans filing for unemployment benefits last week rose unexpectedly).

--Computerized trading models may have exacerbated the losses. Richard Sparks, an analyst at Schaeffer’s Investment Research, told the NYT that the S&P 500 index fell below 1,260 just minutes before the day’s biggest decline (some investors may be using computers that are programmed to sell stocks after that level was reached).

--Blame the dollar. The euro fell to $1.4354, down from about $1.60 in late July. That's good for the price of oil, which dropped $1.67 today, but it's mainly bad because stuff being exported overseas is getting more expensive - and the global economy is worsening. Exports had been one of the few areas propping up the economy. Here's the take at MarketBeat.

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Mark Lacter
Mark Lacter created the LA Biz Observed blog in 2006. He posted until the day before his death on Nov. 13, 2013.
Mark Lacter, business writer and editor was 59
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