Wall Street shares fell in early morning trade today, sending the Dow Jones to levels unseen in two years.
Higher-than-expected retail inflation data dampened hopes for aggressive interest rate cuts by the Federal Reserve.
The latest sell-off came a day after Wall Street greeted the third interest-rate reduction this year from the Fed with a steep plunge. Investor sentiment soured more today amid a fresh wave of downbeat corporate news, including more layoffs in corporate America as the US economy cools.
"It is all part of the bottoming process. I counted 14 negative pre-announcements overnight, and there's four companies announcing layoffs," said Mr Larry Wachtel, analyst with Prudential Securities.
The Dow Jones industrial average plunged 175.93 points, or 1.81 per cent, to 9,544.83, falling to two-year lows.
The broader Standard & Poor's 500 Index was down 11.89 points, or 1.04 per cent, at 1,130.73. The tech-laced Nasdaq Composite Index was down 8.23 points, or 0.44 per cent, at 1,849.21.
