Stocks slammed by housing market worry

[NMDemDist2]

Source: AP

NEW YORK - Wall Street fell sharply Thursday, with the Dow Jones industrial average down over 300 points, extending its weeks-long streak of volatility after disappointing home sales figures added to investors’ increasing uneasiness about the mortgage and corporate lending markets.

Investors who had been able to shrug off concerns about subprime mortgage lending problems and a more difficult environment for corporate borrowing were clearly worried once again. Anxiety increased after the Commerce Department reported that sales of new homes fell 6.6 percent last month to a seasonally adjusted annual rate of 834,000 units, more than triple what had been expected and the largest percentage drop since sales fell by 12.7 percent in January.

Traders also weighed a mixed batch of second-quarter earnings reports from major names like Ford Motor Co. and Exxon Mobil Corp. But disappointing results from home builders including Pulte Homes Inc. and D.R. Horton Inc. — squeezed by a sluggish environment from home sales and continued defaults in subprime loans — weighed heavily on the market.

Read more: http://www.msnbc.msn.com/id/3683270/

[Dollface]

1. Can't wait to hear Cavuto and Beck explain this one.

[mbperrin]

2. Hello stocks! Welcome to the real world!

Don't worry, they be hyper again tomorrow, as they adjust reality to suit themselves and their commissions!

[NMDemDist2]

3. down 400 pts at this point n/t

[Seabiscuit]

4. The market is the most irrational entity in the globe.

The real estate market is of course going to slow down after the sub-prime scandal because there won't be as many sucker buyers who really can't afford to buy getting rigged loans any more.

WTF does this have to do with companies totally unrelated to real estate lenders who have engaged in these unsavory practices? Nothing.

Yet there's a frenzied sell-off across the market spectrum like a horde of pirrahna eating themselves.

[Deja Q]

5. If everybody is worried about America's economy and house market,

make houses more affordable to get.

[NMDemDist2]

6. what? me worry?

hell no! I sold out when it started to slide and own my place in full, paid cash in a rural area

I just :popcorn: now :evilgrin:

[Warpy]

8. My largest holding lost 4.30/share today

and that's a huge chunk of change in paper profits, BUT it's still up almost 20 points from when I inherited it a year and a half ago.

It's also still paying a healthy dividend offset by rich folks' tax breaks.

The market could lose half its value and I'd still be doing just fine because I'm not using it to leverage debt and I'm living on interest and dividends, not on the principal and not on paper profits. It's all just numbers at this point.

My house is paid for, too, and it's in an inner city area where everything I need is within walking distance and everything I want is reachable by mass transit.

[NMDemDist2]

9. you and I both made the right moves this last 18 months didn't we?

how is the search for a contractor going BTW? any movement on that front?

[Kingshakabobo]

7. Also, interest rates are dropping.

People who need to refi will get another look at 6%(maybe lower) for a thirty year. I don't recall, in recent history, a one day downward move this large in the 10 year treasury note yield. Maybe 9/11?

[Bo]

10. 1,000,000+ market is doing nicely though....I love jumbo loans

High end mkt. is doing very well.

[KillCapitalism]

12. That's for sure.

If people could find suitable housing for right around $80-$100K we probably wouldn't be having this problem right now.

[NewYorkerfromMass]

13. Stocks are not inflated right now

but houses sure are. What we are seeing is the house ballon bursting.
The big story last week was Bear Stearns admitting that it's formerly 1.5 billion hedge fund of subprime loans is now worthless.
The housing bubble is over.

[BrokenBeyondRepair]

11. so that's their story.. lol

bye bye dollar