Wall Street plunged again Friday amid renewed fears that the financial sector's troubles with bad credit won't soon end and that some consumers...

Share story

NEW YORK — Wall Street plunged again Friday amid renewed fears that the financial sector’s troubles with bad credit won’t soon end and that some consumers are buckling under the weight of a slowing economy.

The Dow Jones industrials fell more than 306 points in the last hour of the session before regaining a little ground to close at 12,606.30, down 246.79. That wiped out a 117-point advance on Thursday.

Microsoft, one of the 30 Dow stocks, fell 42 cents to close at $33.91 a share. Boeing, also a Dow stock, tumbled $1.84 to $80.52.

Broader stock indicators also declined. The Standard & Poor’s 500 index fell 19.31 to 1,401.02, and the tech-stock-focused Nasdaq composite index fell 48.58 to 2,439.94.

Investors grew nervous after American Express warned that slower spending and more delinquencies on credit-card payments will hamper profit throughout 2008. A profit warning from Tiffany added to Wall Street’s unease about the fortitude of the consumer.

“When Amex comes out and says that some of their well-to-do cardholders are having problems making payments, that’s just not good news,” said Brandon Thomas, chief investment officer of Portfolio Management Consultants, the investment arm of Envestnet Asset Management.

Friday’s session revealed the extent of misgivings about Wall Street’s efforts to sew up its troubles. Bank of America agreed Friday to buy Countrywide Financial for $4 billion, a deal that rescues the country’s largest mortgage lender but pays less than the company’s market value.

Michael Church, portfolio manager at Church Capital Management, said news from the financials is weighing on Wall Street, although he said investors shouldn’t be surprised by the extent of the troubles.

“The financials are going to continue to be a problem,” he said.

The arrival of quarterly earnings reports has investors worried about how banks and brokerages have fared after suffering losses in the collapse of the subprime mortgage market. Traders appeared to grow more pessimistic ahead of reports due next week from Merrill Lynch, Citigroup and JPMorgan Chase.

The Dow is down 4.96 percent for the year, the S&P is off 4.59 percent, and the Nasdaq has lost 8.01 percent.

“I think we’re going to see this volatility at least through the end of the earnings season,” Thomas said.