The Dow fell to a 6-year low Friday, closing at 7,366. The Standard and Poor's index and Nasdaq also lost ground. Driving the downturn were bank stocks. Citigroup fell 17 percent and Bank of America was down 6 percent. Investors were worried that those two troubled institutions were ripe for government takeover.
Those concerns only grew after Sen. Chris Dodd, head of the Senate banking committee, said that some banks might have to be nationalized for a while. That briefly drove the Dow to an 11-year low. It came back up after White House Press Secretary Robert Gibbs insisted that nationalizing banks was not on President Obama's agenda.
"This administration continues to strongly believe that a privately-held banking system is the right way to go, ensuring that they are regulated sufficiently by this government," Gibbs stated.
Some analysts say the market could decline further as investors take a wait-and-see attitude toward the stimulus package and stand by for details from Treasury Secretary Timothy Geithner on how the federal government will resolve the credit crisis.