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Last updated on Thursday, October 9, 2008
(NEW YORK, NY) - Presumptions over General Motors’ credit rating getting cut again sent Wall Street into a selling frenzy.
The Dow Jones Industrial Average, the main barometer of the American stock market, fell more than 675 points to close at 8,586, mostly due to a massive selloff in the later part of the day.
This comes just a year to the day after the Dow closed at its highest level ever, more than 14,000. Since then, both the Dow and the Standard & Poor's 500 have each lost about 40% of their values.
According to a report published by the Associated Press, the sell-off occurred after the Standard & Poor's Ratings Services made the announcement that they would be putting both GM and their credit company, GMAC, under the microscope to see if their credit ratings should be cut. The AP says that means there's a 50/50 shot that S&P will cut the rating within the next 3 months.
S&P also said cross-Motown rival Ford Motor Company would be examined as well.
Now, to add insult to injury, commentators for various cable news outlets are speculating a GM bankruptcy announcement could be the so-called "October Surprise," or major game-changing event, that could have a major impact on the presidential race. However, that may be jumping the shark.
The Dow's nosedive is the first time the index has closed below the 9,000 mark since mid 2003.
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