Dow sings the blues

NEW YORK -- The Dow tumbled to its lowest level in nearly four years this week, capped by a one-day sell-off of 390 points, the seventh-biggest point drop ever.

Fears about earnings and disgust over accounting scandals triggered initial selling in the recent downswing, but the steep declines themselves are now snowballing, analysts say.

"There seems to be a disaster a day, and investors are frustrated," said Robert Harrington, head of listed block trading at UBS Warburg.

Friday's big drop began with news of a government investigation into Johnson & Johnson and quickly turned into a full retreat by bruised investors.

It was the busiest day in the history of the New York Stock Exchange; some 3 billion shares swapped hands. Not one of the Dow's 30 large U.S. companies managed to end regular trading with a gain.

The benchmark index was left 216 points below its Sept. 21 close following the first full week of trading after the Sept. 11 attacks. Stocks have now fallen sharply for nine straight weeks.

"You've got a buyers' strike going on," said Bryan Piskorowski, a market commentator at Prudential Securities.

The Dow fell as much as 442 points before closing down 390.23, or 4.6 percent, at 8,019.26 -- a level last seen in October 1998. The Dow ended the week down 665.27.

At the White House, advisers tried to project an unworried air.

"The fundamentals of the economy are strong and the president is continuing to work closely with Congress on the additional priorities he has outlined to strengthen the economy," White House spokesman Scott McClellan said.

But analysts say Wall Street has reached a disturbing juncture, where catalysts that typically break a losing cycle aren't working. Good economic news -- stronger-than-expected profits at some companies or reassuring words from Federal Reserve Chairman Alan Greenspan -- has been largely ignored by investors.