NEW YORK - Investors retreated from Wall Street again, driven by worries about the nation's big banks and General Motors Corp.
Stocks slid to their lowest levels in more than 12 years Thursday, more than wiping out the previous session's rally. Investors wrestled with relentless uncertainty about the financial system and fresh concerns about GM. Short selling -- bets that stocks will fall -- ahead of the government's Friday employment report exacerbated the losses, slashing 281 points from the Dow Jones industrials and sending all the major indexes down more than 4 percent.
Stocks fell in every industry, with beleaguered banks posting some of the steepest drops. Citigroup Inc., still shaky despite receiving billions in government aid, at times sank below $1 and finished down 9.7 percent at $1.02. GM, meanwhile, ended with a loss of 15 percent at $1.86 as it warned of possible bankruptcy.
"Citigroup going below a buck today was a little scary," said Mark LeStrange, director of sales at Source Trading.
"To say that we're cheap here and it's a good value, it sounds right, but in all reality we could go 50 percent lower," he said. "Nobody has any idea how low we can go."
The Standard & Poor's 500 index is now down 56.4 percent from its peak in October 2007, making it the second worst slide for the index since its plunge of 86.2 percent from 1929 to 1932.
The latest torrent of selling came ahead of the February Labor Department report that is likely to show hundreds of thousands of jobs were lost. Reports showing better-than-expected retail sales and factory orders Thursday weren't enough to stoke investor confidence.
Short sellers also dragged on the market, analysts said. Short sellers place bets that a stock will fall, and rising short positions on a stock can intensify its decline.
