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Dow falls more than 300 points, slips below 13,000

November 07, 2012|By Andrew Tangel
  • On the floor of the New York Stock Exchange.
On the floor of the New York Stock Exchange. (Jin Lee / Bloomberg )

Stocks plunged nearly 2.7% following President Obama's reelection, as the so-called fiscal cliff took center stage as a threat to the U.S. economy.

The Dow Jones industrial average fell a 354 points, or 2.67%, about two hours after the opening bell on Wall Street. The Dow slid below 13,000 for the first since early August.

The broader Standard & Poor's 500 index fell 34 points, to 2.4%, to 1,395. The Nasdaq was down 70 points, or 2.3%, to 2,942.

Obama's reelection -- and with the House remaining in Republican control -- could mean continued deadlock in Washington as the federal government faces automatic spending cuts and tax increases at the year's end. Economists have warned the fiscal cliff, if unresolved, could push the U.S. back into recession.

The president's victory also makes more certain that Wall Street will have to endure new regulations from the Dodd-Frank financial system overhaul of 2010. Many Dodd-Frank rules have yet to be put in place.

In Europe, Germany's economy caused worry as the Eurozone crisis drags on. 

European Central Bank president Mario Draghi said Wednesday: "Germany has so far been largely insulated from some of the difficulties elsewhere in the euro area. But the latest data suggest that these developments are now starting to affect the German economy."

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