The Dow rebounded Friday, closing up more than 300 points. But the index lost about 5 percent for the week as the markets focused on inflation and ballooning government debt.
After the Dow shed 4.6 percent on Monday, Japan's Nikkei and Hong Kong's Hang Seng both dipped by about 5 percent. European shares were also down sharply in early trading.
The stock market continued to lose ground Monday after Friday's steep drop, with the Dow Jones industrial average down nearly 1,200 points — its worst single-day drop.
The Dow Jones industrial average topped 23,000 for the first time, crossing another milestone amid better-than-expected earnings reports and concerns that stocks are approaching another bubble.
Stock markets are often seen as a predictor of what's ahead for the economy. But some say this year's falling markets are crying wolf. "I think financial markets have overreacted," says one economist.
China's economy and stock market are taking hits. Billionaire George Soros says it's setting the stage for another global meltdown. But others argue China's troubles will not trigger a crisis.
Among the factors blamed for China's drop: poor economic data and a looming rules change for large investors. Markets in Europe and the U.S. also were down.
The U.S. economy turned up encouraging signs for most Americans. Workers can now find more jobs, and drive to them using cheaper gas. And retirement accounts are getting a boost from rising stocks.
The Nasdaq has closed at a new high. It last peaked just before the dot-com crash, and "Nasdaq 5,000" soon became code for stock market bubble. Does the record hold any of the same warnings today?