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Weak Economic Data Slams Wall Street

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Stocks continued to show sharp declines Wednesday as disappointing economic reports reignited growth worries.

Today’s Markets

The Dow Jones Industrial Average (DJI) fell 369 points in early trading, the largest intraday drop this year. As of 12:19 p.m. ET, the Dow was down 324 points, or 2%, at 15,990. The S&P 500 (GSPC) fell 36.4 points, or 1.9%, at 1,841. The Nasdaq (IXIC) was down 65.9 points, or 1.6%, at 4,161.

The blue-chip index is facing its fifth consecutive day of red ink amid growing concerns over the strength of the U.S. recovery and economic growth overseas.

In the wake of Wednesday’s lower open, the CBOE’s volatility index reached its highest level since December 2011. Traders piled into the safe-haven of U.S. Treasury bonds, pushing the yield on the 10-year note below 2% for the first time in 16 months.

The Commerce Department said retail sales fell 0.3% in September compared to the prior month, marking the first negative reading since January. Economists were looking for a 0.1% decline.

Meanwhile, the U.S. producer-price index booked a surprise drop of 0.1% last month versus August. It was the first decline in more than a year.

Fears over the spread of the Ebola virus, which has killed over 4,000 people in Africa, are also casting a shadow over the market. The Centers for Disease Control and Prevention said a second nurse who treated the first case of Ebola in the U.S. tested positive and recently traveled on a flight from Cleveland to Dallas.

On the corporate front, Bank of America (BAC) shares slipped 5.7% after reporting a much smaller third-quarter profit. The results included legal costs tied to a $16.7 billion settlement with the Department of Justice. The nation’s No. 2 bank also reported lower-than-expected revenue.

Railroad operator CSX (CSX) beat expectations for both earnings and revenue, although shares fell 2%. During its earnings call, CSX declined to comment on reports that it rebuffed a merger proposal from Canadian Pacific Railway (CP).

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