By Ellis Mnyandu
NEW YORK (Reuters) - The Dow and the S&P 500 fell in choppy trade on Thursday as persistent fears that the widening credit crisis will tip the global economy into recession derailed an attempted rebound, with financials leading the slide.
The Nasdaq was little changed on hopes that not all tech demand was faltering. Still, the market's gyrations threatened to extend Wall Street's rout to seven days and lengthen the bear market's run.
Analysts said despite Wednesday's coordinated rate cut by global central banks and other moves to calm investors, there remained abundant signs that credit markets were gridlocked.
"There's still a significant amount of nervousness that the credit crisis has not seen its end and there are still more problems that lie ahead," said Michael James, senior trader at regional investment bank Wedbush Morgan in Los Angeles.
"People are scared about what they don't know and the fear of the unknown is what's causing people to sell stocks and ask questions later."
The Dow Jones industrial average shed 84.10 points, or 0.91 percent, to 9,174.00. The Standard & Poor's 500 Index lost 10.27 points, or 1.04 percent, to 974.67. The Nasdaq Composite Index inched up 4.81 points, or 0.28 percent, to 1,745.14.
Investors fear the economy will sink under the strain of reduced spending as businesses and consumers grapple with tight credit.
Top drags on financials included shares of Morgan Stanley, down 15.7 percent at $14.16, and Wells Fargo , off more than 10 percent at $28.60. The S&P financial index was off 4 percent.
The drop in financial shares also followed the expiration of a U.S. Securities and Exchange Commission's ban on short selling in more than 950 financial stocks.
General Motors was off more than 17 percent at $5.67. Concern that a slower economy will hurt energy demand hit the shares of Chevron Corp, down 5 percent at $69.16 and Exxon Mobil off 2.4 percent at $75.17.
Initially stocks had rallied on bargain hunting and on hopes that hopes technology spending would revitalize a day after International Business Machines Corp , a technology services giant, posted a solid quarterly profit.
(Editing by Kenneth Barry)
