Wall Street plunges on banking woes

NEW YORK: US stocks plunged Tuesday as renewed fears about the global banking sector offset optimism surrounding the inauguration of Barack Obama as the 44th president of the United States. The Dow Jones Industrial Average slid 332.13 points (4.01 percent) to 7,949.09 at the closing bell, slipping below the key level of 8,000. The Nasdaq composite sank 88.47 points (5.78 percent) to 1,440.86 and the broad Standard & Poor's 500 index lost 44.90 points (5.28 percent) to a preliminary close of 805.22.The carnage was concentrated in the financial sector, with Citigroup sinking 19 percent on worries it may require a new bailout or nationalization. Bank of America lost 28 percent and JPMorgan Chase 20 percent. "The current leaning indicates that Mr Obama's honeymoon period will be a short one -- it may already be over," said Patrick O'Hare on media. "It also indicates the concern that exists about a nationalization of the banking system.Those concerns hit a new level yesterday as word from the Royal Bank of Scotland that it could post a loss of as much as 41.3 billion dollars for fiscal 2008 helped trigger a new round of intervention by the UK that some believe will ultimately lead to a full-scale nationalization of RBS and perhaps the banking system in the UK," he added."After the week Bank of America, Citigroup and others had last week, similar concerns, unthinkable just 18 months ago, continue to fester here at home."