NEW YORK—Investors rushed to shed risk and drove the stock market down on Wednesday, with major indices around the world down substantially for the second session in three days.
The Dow Jones Industrial Average suffered another massive drop—declining by 519.8 points, or 4.6 percent. The S&P 500 Index fell 52.8 points, or 4.4 percent, while the Nasdaq Composite Index dropped 101 points, or 4.1 percent.
With Wednesday’s drop, the Dow is now at an 11-month low.
The drubbing suffered by the markets came as investors were fearful that the eurozone debt crisis would hit previously deemed healthy nations, including France. French banks led financial shares lower across all markets.
Shares of Societe Generale, one of the biggest banks in France, dropped by almost 23 percent before settling down 15 percent on Wednesday. Shares of rival bank BNP Paribas also fell, by almost 10 percent.
Amid rumors that the bank is facing financial difficulties—and reportedly had a meeting with French President Nicolas Sarkozy—a spokesperson denied the rumors as false, according to a Guardian report.
Among the biggest losers within the Dow include Bank of America Corp., which saw its shares fall 11 percent on worries regarding its legacy residential mortgage loan portfolio. CEO Brian T. Moynihan went on a conference call with analysts Wednesday pledging that he would aggressively trim such assets from the bank’s balance sheet. Shares of the Walt Disney Co. fell 9.1 percent, while Boeing Co. dropped 7.3 percent.
Investor trepidation drove up the CBOE Volatility Index (VIX), also referred to as the market’s “fear gauge,” up 23 percent to 42.99. Gold futures hit another record high, at one point eclipsing $1,800 per ounce, to settle at $1,784.30 per ounce in New York.
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