Investors Look for Safety as Markets Test Bottom
A retest of the November lows for the Dow industrials has investment pros worried about a worst-case scenario that could send stocks plunging even further.
With the market focus much stronger these days on technical levels than fundamentals, the Dow tripping below the Nov. 20 level of 7,552 could set off a wave of selling that in turn would drag the other indexes down as well.
Only the Dow has moved into retest position, with the composite index of 30 industrial stocks closing Tuesday just a shade above the recent low. The S&P 500 and the Nasdaq are both still considerably higher than their respective November depths of 752 and 1,316, but analysts worry that any breaching by the Dow could spread.