US stocks drop on World Bank forecast, Buffett warning

March 10th, 2009 - 11:30 am ICT by IANS  

New York, March 10 (DPA) Major US stock indices closed lower Monday, after the World Bank said it expects the global economy to shrink this year and billionaire Warren Buffett offered another dire assessment about the state of the US economy.Buffett, the world’s richest man according to Forbes Magazine, told US business broadcaster CNBC that the economy “has fallen off a cliff” and criticized the US government response to the crisis as “muddled”. Buffett’s holding company, Berkshire Hathaway Inc, recently reported its worst-ever annual results for 2008.

The World Bank Sunday forecast a global contraction this year for the first time since World War II, painting an even bleaker picture than its sister organisation, the International Monetary Fund. The IMF in January predicted that the world economy would grow at 0.5 percent for 2009.

Technology stocks declined sharply, led by a 5.7-percent drop in Google Inc’s share price.

The blue-chip Dow Jones Industrial Average fell 79.89 points, or 1.21 percent, to close at 6,547.05. The broader Standard & Poor’s 500 Index dropped 6.85 points, or 1 percent, to 676.53 while the technology-heavy Nasdaq Composite Index tumbled 25.21 points, or 1.95 percent, to end at 1,268.64.

The US currency edged up against the euro to 79.34 euro cents from 79.03 euro cents Friday and climbed against the Japanese currency to 98.8 yen from 98.26 yen.

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