Dow And Nasdaq Stumble On Investor Fears

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The fear bug bit investors again, and it cause the Dow Jones Industrial Average to plunge 280 points. Investors were anticipating a possible Fed cutting of interest rates, and when it became clear that would probably not materialize jovial moods turned sour as folks headed towards the exits.

The stock market found little to assuage concerns in minutes from the Fed’s last meeting, released during afternoon trading. The major indexes’ losses steepened after investors parsed the minutes for signs of a possible cut in interest rates.

There had been some hope on the Street that Fed policymakers might have sent a stronger signal they were more willing to cut interest rates to help calm turbulent market conditions. But in the minutes from the Federal Open Market Committee’s Aug. 7 meeting, while the central bank noted the turmoil in the markets and said, “to the extent such a development could have an adverse effect on growth prospects, might require a policy response,” it didn’t discuss a cut in the benchmark federal funds rate that Wall Street has wanted.

Investors are looking for any signs about the economy improving, and failing to see them, are beset with panic. Consumer confidence is lagging, and people are unsure where to put their money. When they’re unsure, they usually keep their funds in handy cash.

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