US stocks had the largest decline in three years after a historic downgrade of the nation's debt by Standard & Poor over the weekend. A midday comment from President Obama failed to stem the losses and the Dow closed down more than 5.5%, the S&P sank by more than 6.6% and the NASDAQ lost 6.9%.
S&P said the downgrade based based on the failure of politicians to address deficit reduction in its effort to avoid default. Investors sold equities for fear that the economy may slowdown and flocked to safe havens like bonds and precious metals. Among the biggest losers today were financial stocks, especially Bank of America (NYSE:BAC) which lost 20% of it's value today. Major oil stocks were also lower by 8.5% as a group. Computer hardware and retailers shares were down about 5%.
Tomorrow afternoon investors will eagerly await a statement prepared by The Federal Reserve following a morning meeting regarding the crisis.
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