Dow Plunges (2-10-09)

Economic News:

So the Dow, along with the other major indices, plunged over 4% today.

Market Reaction:

The main reason for the fall was due to investors' negative reaction to the lack of details on the financial rescue plan that the US Treasury announced today.

Stocks:

Many attractive stocks now look even more attractive after today.

GE, which rose about 13% the day before, fell about 12% today. I'm considering buying GE tomorrow. The fact of the matter is, this company is still a bell weather stock and, although it faces difficult times ahead due to general economic conditions, it should survive the financial crisis.

Apple and RIMM, both great long-term companies, dropped around 5%. I should purchase these as long-term investments, rather than selling them everytime they move up 10 or 20%.

Mittal dropped about 11% today. This company has great fundamentals. It is true that it will suffer from the global downturn, but this company is trading close to its 52-week low. There is significant potential here if the US stimulus and China stimulus gain traction sooner rather than later.

B of A and Wells Fargo also look attractive. I got burned on WFC when it fell dramatically last month. Both stocks are very low. But there is so much uncertainty around what is going to happen with these large financials that I think I should hold off on moving in.