Wall Street tumbles, weighed by Goldman charges
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Wall Street tumbled on Friday, with the Dow plunging triple digits and S&P losing more than 1.5 percent, as Goldman Sachs was reportedly charged with fraud by the government and earnings from some major technology companies weighed on the market.
Friday's broadly-based decline comes after six straight days of gains that pushed the Dow to its highest close in more than 18 months.
Financial sector plunged most, led by Goldman Sachs whose shares sank about 13 percent, after the Securities & Exchange Commission charged the Wall Street investment giant with civil fraud for misleading investors about a financial product tied to subprime mortgages.
Bank of America also plummeted 5.49 percent even after the company said it had returned to profitability after two quarters of losses. JPMorgan Chase fell 4.73 percent, and Morgan Stanley and Citigroup declined more than 5 percent amid concerns about the Goldman Sachs lawsuit.
Technology sectors were also under great selling pressures as investors worried some bellwethers of the industry might face challenges in their future operations.
Google fell more than 7 percent after the searching engine giant reported first-quarter profits that fell short of some analysts' estimates.
Google said its net income rose 37 percent in the first three months of the year, showing the online advertising and technology sectors are bouncing back from the recession more quickly than many other parts of the economy. However, its performance wasn't enough to live up to the very high expectations, which was boosted even further by strong earnings from Intel.
Shares of Advanced Micro Devices also plummeted after the chip maker said it expects revenue in the current period to decline by as much as 5 percent from the first quarter.
Friday's economic news came mixed, which did little to provide any support for the market. The Commerce Department said before the opening bell that housing starts increased 1.6 percent to a seasonally adjusted 626,000 annual rate, higher than analysts had expected.
Separately, the University of Michigan's Consumer Sentiment index fell to 69.5 in April from March's reading 73.6, failing to hit the 75-mark that economists had been hoping for.
At market close, the Dow Jones industrial average plunged 125. 91, or 1.13 percent, to 11,018.66. The Standard & Poor's 500 index tumbled 19.54, or 1.61 percent, to 1192.13 and the Nasdaq was down 34.43, or 1.37 percent, to 2,481.26.
