Dow Plunges 680 Points on Economic Worries

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WALL STREET - Among the Monday afternoon headlines.. Stocks are battered by falling oil prices and evidence of a deepening economic slump. Markets may open higher on Tuesday. Shoppers pounce on bargains during the opening of the holiday shopping season. Ford may sell its Volvo unit. November is bad for stocks -- but could have been worse.

The Dow fell 680 points, or 7.7%, to 8,149. The S&P 500 was off 80 points, or 8.9%, to 816, and the Nasdaq Composite Index tumbled 138 points, or 9%, to 1,398.

The slump took back more than half of the Dow's 1,277-point gain over the previous five sessions. Early futures trading, however, suggests that the market may open slightly higher on Tuesday.

The sell-off began with profit-taking after five straight positive days and gained momentum with a series of economic reports. The National Bureau of Economic Research said the U.S. economy fell into recession in December 2007. A report showed a deepening slump in U.S. manufacturing. But the U.S. wasn't alone. Manufacturing activity in China contracted by a record amount in the last month.

The point losses for the Dow, S&P 500 and Nasdaq were their worst since Oct. 15. The Nasdaq's percentage loss was its sixth-worst ever. The Dow's percentage loss was its 12th-worst ever. The S&P 500's percentage loss was its 11th worst overall and third-worst since the 1987 market crash.

All 30 Dow stocks were lower on the day. The best performer was McDonald's, and it was down 4.4% to $56.17.

In addition, only one S&P 500 stock was higher -- Rohm & Haas, up 3.5% to $70.82. All 100 stocks in the Nasdaq-100 Index which tracks the largest Nasdaq stocks, were lower. The index fell 8% to 1,091.

Today's selling precipitated a rally in bonds, with the yield on the 10-year Treasury dropping to 2.72% -- the lowest yield on the 10-year note since 1955. The yield fell further when Federal Reserve Chairman Ben Bernanke said in an Austin, Texas, speech today that the central bank may start targeting long-term rates.