NEW YORK, March 1: Bleak news on the US economy and the corporate sector sent Wall Street into a tailspin on Friday with steep losses for the main indexes.

The market opened weaker and the selloff accelerated in the wake of grim news on the corporate earnings front combined with data showing a sluggish US economy that still faces inflation worries.

The Dow Jones Industrial Average plummeted 315.79 points (2.51 per cent) to end at 12,266.39 and the tech-heavy Nasdaq skidded to a 17-month low with a loss of 60.09 points (2.58 per cent) to 2,271.48.

The Standard & Poor’s 500 broad-market index slid 37.05 points (2.71 per cent) to 1,330.63.

The markets were “under heavy pressure in the wake of a falling dollar, weak economic reports, and disappointing earnings from Dell and American International Group, said Al Goldman at AG Edwards.

A report that a bank bailout of bond insurer Ambac Financial is running into snags also weighed on the market.Inflation worries remained on the front burner as crude oil briefly hit fresh highs above $103 a barrel in New York.

Meanwhile an inflation index in a report on US personal income and spending showed consumer prices rose 0.4 per cent in January while core prices, excluding food and energy costs, increased 0.3 per cent.

The report showed consumer spending rose 0.4 per cent, but was flat after adjusting for inflation.

Real consumer spending was flat for a second consecutive month in January, as households limped into 2008 reeling from higher energy costs, falling home values, less credit availability and weakening employment, said Peter Kretzmer at Bank of America.Economic fears were heightened as AIG, the world’s biggest insurer, said it expects the US housing market to remain weak and credit market uncertainty to persist.---AFP