SAN JOSE (CBS SF) – A late day rally pulled the financial markets out of a steep dive Wednesday, but the tremors were still felt in the Silicon Valley where many tech stocks took a wild ride during the session.
At the closing bell, the Dow -- which had fallen 566 points at the lowest point of the day -- was off more than 249.2 points or 1.56 percent while the NASDAQ dropped 0.12 percent and the S&P 500 had lost 1.16 percent of its overall value.
Twitter shares rallied from threatening to reach at 52-week low early in the session to a 4.13 percent increase to $17.38 a share. Apple also rallied after falling nearly 3 percent early in the day to ending at a plus 0.13 percent.
Yahoo dropped 3.23 percent in value to fall to $28.78 a share – the firm's 52-week low is $27.20.
Meanwhile, Google had fallen 0.48 percent in value, Facebook dropped 0.96 percent and Netflix was off 0.14 percent.
At one point during the morning trading, 1300 stocks were at new lows -- the highest number since Nov. 2008.
The plunge coincided with the continued drop in the price of crude oil.
Investors worry that the global glut in crude will cause deep damage to oil and gas companies and lead to more bankruptcies and layoffs in the sector. IBM sank after reporting another drop in revenue. Japan's benchmark index, the Nikkei, entered a bear market.
OIL DOWN AGAIN: Oil prices had already fallen to 12-year lows this week, and the price of U.S. crude has dropped more than 20 percent this year. On Wednesday benchmark U.S. crude gave up $1.21, or 4.3 percent, to $27.25 a barrel in New York. Brent crude, a benchmark for international oils, lost 99 cents, or 3.4 percent, to $27.77 a barrel in London. Heating oil and wholesale gasoline prices also decreased.
ENERGY KEEPS FALLING: Energy stocks were pelted. Devon Energy lost $2.16, or 9.2 percent, to $21.32 and Marathon Oil dropped 56 cents, or 7.3 percent, to $7.12.
IBM FALLS: Commercial tech giant IBM said its revenue fell again, the 15th consecutive quarter it had reported a decline. Its sales fell about $170 million short of Wall Street forecasts. The stock shed $6.98, or 5.4 percent, to $121.13.
HOMEBUILDERS SLUMP: Homebuilders fell after the Commerce Department said housing starts decreased in December. Still, residential construction ended 2015 at its healthiest level in eight years. Beazer Homes sank $1, or 12 percent, to $7.62 and KB Home fell 57 cents, or 6 percent, to $9.30.
IMF OUTLOOK: The International Monetary Fund cut its forecast for this year's global economic growth to 3.4 percent from its October outlook of 3.6 percent. The IMF downgraded the outlook for developing economies to 4.3 percent growth from 4.5 percent in October.
SPIRIT RISES: Spirit Airlines said its profit margins will be stronger than expected and costs for aircraft rent, maintenance and other items will be smaller. Its shares gained $1.20, or 3.2 percent, to $39.10. The plunge in energy prices has also helped airlines save money on jet fuel.
GNC PUMPED UP: Nutritional supplement retailer GNC Holdings said its adjusted profit for 2015 will be at the high end of its previous estimates. Its stock rose 96 cents, or 4.1 percent, to $24.52.
ZAFGEN SURGES: Drug developer Zafgen climbed after the company said its most advanced experimental drug succeeded in a late-stage clinical trial. The trial evaluated beloranib as a treatment for a rare genetic disorder that causes life-threatening obesity. Its stock jumped $4.27, or 76 percent, to $9.89.
BONDS: U.S. government bond prices rose as traders shifted money into lower-risk investments. The yield on the 10-year Treasury note dropped to 1.98 percent from 2.06 percent a day earlier. That yield, which is a benchmark for setting interest rates on home mortgages and other kinds of loans, has fallen sharply since the beginning of the year. At the end of 2015 it stood at 2.30 percent.
OVERSEAS: Japan's Nikkei fell 3.7 percent and is down more than 20 percent from its June peak. Hong Kong's Hang Seng retreated 3.8 percent. The Shanghai Composite Index lost 1 percent. In Europe, Germany's DAX tumbled 2.8 percent and France's CAC-40 shed 3.4 percent. Britain's FTSE 100 sank 3.1 percent.
CURRENCIES: The dollar fell to 116.52 yen from 117.44 yen late Tuesday. The euro fell to $1.0912 from $1.0923.
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