WASHINGTON (AP) -- The U.S. economic recovery is on shakier ground.
The growing European debt crisis has sent stock markets on a wild ride. A weaker European economy could sap demand for U.S. exports and hurt sales by U.S. companies in Europe. U.S. banks that hold European government debt also could cut back on lending to conserve cash.
''The perception of risk has just changed in a major way,'' said Mark Vitner, senior economist at Wells Fargo Securities. ''Business leaders now think there is more risk in the world economy than they did 30 days ago.''
Wall Street endured a dizzying plunge Thursday, sending the Dow Jones industrials to a loss of nearly 1,000 points in less than half an hour. A computerized selloff possibly caused by a trader's mistake may have been responsible for the late-session plunge, and the Dow recovered two-thirds of the loss before the closing bell.
The 1000 point plunge was in part an error, but the dow sill ended up losing 350 points and clearly people are very nervous that the soial-welfare states of europe may collapse in on themselves.
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