Wall Street sinks to lowest since 2003

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New York, November 20: : 23.4 per cent to $6.40. The S&P financial index skidded 11.6 per cent.

Adding to concerns about the financial sector's health, bonds with exposure to commercial real estate experienced a meltdown on worries that the ailing economy could lead to a round of defaults on loans for office buildings, retail stores and hotels.

The Fed lowered its forecast range for 2008 gross domestic product growth and said the economy could shrink by 0.2 per cent in 2009. Minutes from the Fed's most recent policy meeting also showed some officials believed even more interest rate cuts may be needed as the economy falters.

The Fed cut its fed funds rate to 1 per cent from 1.5 per cent at its scheduled meeting last month, part of an aggressive rate-cutting campaign that has taken the benchmark rate for overnight bank loans down 3.25 per centage points since the beginning of the year.

Also on the economic front, US consumer prices fell at a record pace in October and home building sagged to new lows, according to data that suggested the economy is already in a recession that could become prolonged.

On Nasdaq, Yahoo Inc slumped 20.9 per cent to $9.14 after Microsoft Corp's chief executive ruled out an acquisition of the Internet media company, saying his company was interested in restarting talks on a Web search partnership.

Trading volume was active on the New York Stock Exchange, with about 1.64 billion shares changing hands, below last year's estimated daily average of roughly 1.90 billion, while on Nasdaq, about 2.36 billion shares traded, above last year's daily average of 2.17 billion.