The specter of a General Motors Corp. bankruptcy and a prediction that crude oil might fall to $25 a barrel put shivers into energy stocks, pushing the rest of the market down Thursday. The Dow lost 215.45, or 2.51%, to 8,376.24 while the Nasdaq dropped 46.82, or 3.14%, to 1,445.56.
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GM closed down nearly 16% as it looked into every possible scenario to save itself, ranging from selling some units within the company to layoffs to renewed negotiations with its unions. The Detroit company's chief Rick Wagoner also testified to members of Congress Thursday, requesting a bailout.
Wagoner told senators that "the plan we are submitting to you is one I and the General Motors team believe very strongly in."
The automaker says it needs $4 billion by year's end, another $8 billion early in 2009 and a final $6 billion in a line of credit to bring it back to health. Meanwhile, Ford Motors Co. is asking for a $9 billion credit line just in case conditions deteriorate.
Meanwhile in the energy sector, Exxon Mobil Corp., Chevron Corp., Marathon Oil Corp. and BP plc were all in the red on Merrill
Lynch & Co.'s prediction that oil will hit $25 a barrel. - Gerald Magpily
