NEW YORK (AP) -- Stocks fell sharply after word came that Democratic congressional leaders would postpone consideration of an auto industry bailout.
A brief advance was seen at mid-session on hopes that something might be done more quickly.
The Dow fell 445 points to 7,552. That was a loss of more than 5.5 percent.
The S&P was down 54 points to 752, and the Nasdaq composite declined 70 points to 1,316.
Declining issues outnumbered advancers by a 13 to 1 margin on the New York Stock Exchange.
Volume came to 8.8 billion shares on the NYSE. Some 3.1 billion shares were traded on the Nasdaq stock market.
Democrats Hold Off On Auto Bailout Vote
Democratic leaders in Congress have put off a vote on bailing out the auto industry until next month, and want the top companies to present a plan showing the money will make them financially viable.
"The executives of the auto industry have not been able to convince the American people or the Congress that this bailout would be their last," Senate Majority Leader Harry Reid of Nevada said at a news conference.
House Speaker Nancy Pelosi said: "Until they show us the plan, we cannot show them the money."
The industry has been asking for $25 billion in loans to stay in business until spring.
Unemployment Benefit Claims Increase
The Labor Department said new claims for unemployment benefits rose last week to a 16-year high. The Labor Department said claims rose by 27,000 to a seasonally adjusted 542,000. That's the most since July 1992.
The White House said President George W. Bush would sign legislation pending in Congress to extend unemployment benefits. The Senate is expected to take up a bill already passed by the House that would extend unemployment insurance for those whose benefits have run out. A vote could come as early as this evening.