The Fed’s gloomy economic outlook, coupled with apprehension that little can be done to keep the global economy from skidding into another recession, sent market participants ditching risky assets and fleeing into Treasuries in the worst two-day plunge since the financial crisis in 2008. Hit the jump to read the rest of the story.
@WiL

Today’s Markets
The Dow Jones Industrial Average tumbled 391 points, or 3.5%, to 10,734, the S&P 500 fell 37.2 points, or 3.2%, to 1,1230 and the Nasdaq Composite plunged 82.5 points, or 3.3%, 2,456. The FOX 50 shed 24.8 points to 826.

The selloff was broad: more than a quarter of S&P 500 components touched 52-week lows. Volatility, as measured by the VIX, spiked 11%. In a sign of the conviction of the selling, volume was at the highest level since early August.
With global markets and U.S. equities in selloff mode, Treasury prices rallied, shoving yields down. The yield on the 10-year Treasury sunk to 1.726% from 1.868% — briefly touching a record low multiple times during the session.
Overall, the blue chips have shed close to 700 points, or 6.1% in two trading days. The broader indexes have performed poorly as well: the S&P 500 has shaved 6.2% and the Nasdaq has lost 6%.
While every major sector was down, materials and energy stocks took the biggest beating. Mining giant Freeport-McMoRan Copper (FCX: 32.14, -3.45, -9.69%) was recently nearly 9.7% to the downside, while exploration-technology firm Schlumberger (SLB: 61.22, -3.93, -6.03%) shed more than 6%.
The Federal Reserve moved to lengthen the maturity of its balance sheet, an indirect bid to stimulate the economy, at its meeting that concluded on Wednesday as was widely anticipated. The $400 billion scope of the “twist” from short-term to longer-term Treasuries was, however, modestly broader than many economists had been anticipating, according to a research note from Goldman Sachs.
However, the Dow plunged 284 points in less than two hours after the decision that was dubbed “Operation Twist” was announced, in a sign that many market participants are wary that the central bank won’t be able to reinvigorate a stalling economy.
“A downbeat outlook for the economy combined with the so-called ‘Operation Twist’ economic stimulus not going far enough in many people’s eyes,” David Jones, chief market strategist at IG Index, a London-based trading firm, wrote in a research note.
FX