Local Companies Rise As Stock Market Plunges
MINNEAPOLIS (WCCO) – Fears about the global economy led to the biggest panic in financial markets since the 2008 financial crisis.
The Dow plunged nearly 513 points Thursday, its biggest point decline since falling 677 on Dec. 1, 2008 in the midst of the financial crisis. The last time the market recorded a larger percentage drop was in early 2009.
Only three of the 500 stocks in the Standard & Poor's 500 index had gains. Oil fell by 6 percent. The yield on the two-year Treasury note hit a record low as investors sought out relatively stable investments.
All three major stock indexes are down 10 percent or more from their previous highs, a drop-off that is considered to be a market correction. A drop of 20 percent or more signifies the start of a bear market, an extended period of stock declines.
The Dow Jones industrial average was down 512.76 points, or 4.3 percent, to 11,383.68. Thursday's losses turned the blue-chip stock index negative for the year.
The S&P 500 — the benchmark for most mutual funds — lost 60.20, or 4.8 percent, to 1,200.14. It is now down 12 percent from its recent high of 1,363 reached on April 29. The Nasdaq composite shed 136.68, or 5.1 percent, to 2,556.39.
Investors are increasingly concerned about the possibility of another recession in the U.S. and a debt crisis in Europe.
Despite the downward trend, there's a couple Minnesota companies still managing to emerge as rising stars.
3M for example, just released second quarter earnings showing a 14 percent rise in sales to the tune of a record $$7.7 billion.
Target also saw a four percent rise in July sales.
WCCO-TV asked Financial Consultant Bruce Helmer with the Wealth Enhancement Group out of Chaska why he believes these companies have been able to defeat the odds. He said in large part, it's because they are multi-national with trading partners around the world.
"Broadly diversified, smartly, well-run companies are going to well over the long-term. On a day to day basis, the stock price can take a hit, but long-term, if they're well-managed, they'll recover," said Helmer.
Here is a full report from CBS News on Thursday's stock market plunge
