Rocky Day for Stocks on Wall Street

By: Nikki Boyd
By: Nikki Boyd

(CBS) WVLT - The bears are growling on wall street. The dow continued to drop. It's now below 13,000.

As CBS' Alexis Christoforous reports from the New York Stock Exchange, there are plenty of reasons for investors to be nervous.

For the first time since April, the Dow dipped below that psychologically important milestone.

But veteran traders say, in the end, it s just a number.

Joe Benanti, NYSE floor trader says, "I think 13K might be a short term psychological point for people to hold onto."

But you can t deny it has been quite a journey.

It took the DOW just 12 weeks to make the jump from 13,000 in April to 14,000 in July.

But in just a month's time, the DOW has given back those thousand points, as the subprime mortgage mess and credit crunch begin to put the brakes on the economy.

Sam Stovall, Chief Investment Strategist for the Standard and Poor's says, "Every bull market since 1970 has seen at least one 10-plus percent correction within it. We have not had one since this bull market was acknowledged in may of 2003. So I think we're overdue."

There was some encouraging news, inflation appears to be under wraps giving the federal reserve some room to cut interest rates.

Stovall says, "They're looking for the fed to begin lowering the short term, or fed funds rate in September, rather than waiting until the first half of 2008."

Experts say investors need to see some stability in the markets before they'll jump back in, so stocks may still have further to fall.

Benanti says, "I don t think you want to try and pick the bottom we might have, we might be in it, we don t know it. But to try to pick it is sometimes fools play."

The best advice, experts say sit tight until wall street's rocky ride finds calmer ground.


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