Panic Selling Overtakes Blue Chips, Bargain Hunters Step In

The markets opened sharply lower with the Dow tumbling nearly 700 points in the opening minutes of trading before retracing to 8350, down more than 200 points.  Nasdaq lost a more modest 19 points to 1625.

On the upside

General Electric (NYSE: GE) posted a smaller profit that met lowered expectations.  The conglomerate managed to report a profit at its troubled GE Capital unit.

Wachovia Bank (NYSE: WB) ended up in the hands of Wells Fargo (NYSE: WFC) whose $15 billion all-stock offer topped a joint rescue effort by Citigroup (NYSE: C) and regulators.

The market capitalization of Google (Nasdaq: GOOG) briefly fell below $100 billion before bargain hunters stepped in.

On the downside

Credit ratings agency Moody's Investors Service placed a negative outlook rating on Goldman Sachs (NYSE: GS).

Industry experts predict oil prices to test the $75 a barrel level.  Shares of Exxon Mobile (NYSE: XOM) and Chevron (NYSE: CVX) fell.

Shares of Morgan Stanley (NYSE: MS) tumbled again on worries that Mitsubishi UFJ may revise the terms of its investment into the troubled investment banker.

In the broad market, declining issues outpaced advancers by a margin of more than 6 to 1 on the NYSE and by nearly 3 to 1 on Nasdaq.  The Russell 2000 which tracks small cap stocks lost 7 points to 491.