US shares lowest

US shares have fallen sharply on concerns about the government’s latest attempts to shore up the banks.

The Dow Jones Industrial average closed down 251.4 points or 3.41% at 7,114.3, it’s lowest since October 1997.

In fact, the shares in the banks rose sharply, with Citigroup up more than 11% and Bank of America rising over 5%.

The US government reiterated its determination to keep banks operating, but added it wants the banks themselves to stay in private hands.

There had earlier been reports that the government was planning to take a bigger stake in Citigroup and could even nationalize it.

“People left and right are throwing in the towel”, said Keith Springer from Capital Financial Advisory Services.

“The biggest thing i see here is the incredible pessimism – the government is doing a lousy job of alleviating fears”.

Technology shares also fell on reports that a reorganization is planned at Yahoo!

The technology based Nasdiq index fell 53.5 points or 3.71% to close at 1,387.8

These falls pick up from a tough last week, when all the major indices fell by more than 6%.

You might also be interested in