sales dropped by 3.5%, worse than expected; a significant slowdown in manufacturing-- the philadelphia federal reserve said its regional index plunged to a reading of minus-30; and from the job market-- a spike in filings for unemployment benefits, up by 9,000. >> tom: now, that picture of a stalling u.s. economy led to massive selling on wall street. the dow tumbled 420 points, the nasdaq lost 131, and the s&p down 53. big board volume rose to 1.6 billion shares, while nasdaq volume climbed to 2.75 billion shares. here's the dow's intra-day performance. as you can see, it was down, down, down at the open, and we stayed lower all day. since the selling began on july 21, the dow is down almost 13%. suzanne pratt was on wall street today and has more on the market plunge. >> reporter: just when you think it can't possibly get any worse for the stock market, it does. today, it was fresh concerns about economies around the world that walloped wall street. a big salvo came from morgan stanley's slashing of its global growth forecast for this year and next. the investment firm says the u.s. and europe are h

benefits rose back above four hundred thousand the largest number in four weeks and the philadelphia federal reserve's manufacturing activity show that one of the post recession bright spots isn't going to contract now as it is the fact of the yield on ten year treasuries fell below the two percent mark for the first time in at least seventy years gold prices are again marching to record territory is nearing one thousand eight hundred thirty dollars an ounce it's a lot of data to suggest but how big is what it's telling us join. from our studio in new york is kelly evans head of the tate columnist at the last return kelly i want to thank you so much for joining us tonight so i just you know spoke about all the data there and you have people running against a goal that's again hitting highs you have people buying a treasury to treasuries despite the fact that the yields are so low people seems like they're panicking like they want some kind of a safe haven what does that tell you yeah it tells you about a lot about mentality right now it tells you that these are the kinds of moves we typically only see

one of our leading manufacturing indexes out of philadelphia, the federal reserve bank there came in startling lower. we have never seen that level unless we were in a recession. manufacturing data and fears about the financial system obviously triggered a huge sell-off. it was underwater all day and finished low. >> the fed said it would keep interest rates low for the next couple of years. does the government have many more tools in its bag to help this economy? >> the fed might suggest something differently. almost everyone who watches the federal reserve is convinced that they really do not have much left. they could go in and buy more assets. they could pump money into the economy. the real problem is that here in the u.s. for all of the cash increases, it is not being put to work in the economy by companies or consumers. it is what we call a liquidity crunch. and without action from congress, from the political side of the spectrum, from lawmakers with stimulus and jobs programs, there is a growing sense in the marketplace that we are heading for a recession and there is really

then a key manufacturing report says that the federal reserve's philadelphia region fell to an extremely low level, a recessionary level. that has people worried about manufacturing falling back. and one more note. a company out of sunnyvale net app that specializes in data storage lowered its forecast for the current quarterback and fell last quarter. people are worried that business investment in i.t. is going to be pulling back. so the news is bad from so many angles. that's why wall street has taken a pummeling today. >> there are so many companies taking a big hit today including hp but they took a bounce as reports that there could be some changes coming for them. >> reporter: big changes. hp, one of your iconic pc makers out there, reported to be selling its pc business. now, hb is not commenting on that. it's reporting its earnings after the closing bell only told me to stay tuned to the closing bell. there have been reports -- bmo capital analysts said yesterday that hp should sell its pc business and there are also reports that hp is interested in buying an enterprise software

. >> the federal reserve back of philadelphia said manufacturing orders dropped in july to lowest levelzv in almost two and a half years, that could translate into more job losses. there was disappointing real estate news, sales of existing homes fell 3.5% last month to an eight-month low. market jitters could work into consumer spending

philadelphia. here are three things to put on your rare. ben bernanke and the federal reservebout our economy. we'll talk to the chairman of the s&p. and this afternoon president obama meeting with secretary of the treasury tim geithner, a closed door meeting. can you guess what they will be talking about. they are rich but on tax day they didn't owe the government a dime. why did hundreds of millionaires not have to pay federal income taxes? ♪ ♪ [ male announcer ] more people are leaving bmw, mercedes and lexus for audi than ever before. experience the summer of audi event and get over 130 channels of siriusxm satellite radio for 3 months at no charge. that's me with the blow dryer and the flat iron until i see smoke. so pantene said, "breakage and split ends? no problem." they gave me this pantene called breakage to strength. [ female announcer ] the keratin protection pro-v system helps prevent then repair split ends. zero fear of breakage, 100% more strength. no regrets, just health. i'm not giving up the heat. [ female announcer ] the breakage to strength system from pant