Market May Finally Be Listening to Greenspan

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No, your eyes aren't failing you — there's bad news on Wall Street, and plenty of it. The Dow Jones industrial average took its fourth worst points plunge on Tuesday and dragged the heretofore unflappable NASDAQ index with it. The bad news began in the morning when Dow stalwart Procter and Gamble announced third-quarter earnings that will be 10 to 11 percent below last year's figures. The conglomerate's stock plummeted by nearly a third on the news, and the rest of the Dow quickly followed. "Psychologically, it's bad for the industrial stocks when you see a powerhouse like Procter and Gamble slumping," says TIME business writer Dan Kadlec. "At the same time, it's reminding people that earnings-announcement season is right around the corner."

By the time trading was finished for the day, the Dow had plunged 3.7 percent, or nearly 400 points. The downward spiral was aided by the Street's current climate of uncertainty, courtesy of Alan Greenspan's repeated indications that he'll raise interest rates until the stock market bubble deflates. "Greenspan is targeting the NASDAQ, which is totally inflated with all those tech stocks," says Kadlec. "But unfortunately, the Dow is really being caught in the crossfire." But not even the NASDAQ went unscathed today. After surpassing 5,000 for the first time ever in Tuesday morning's trading, the tech-heavy index skidded, to finish down 57.