Stocks Hurt Most by the Market Mayhem

The damage on Wall Street extends far beyond the financial sector.

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It's not just a Wall Street meltdown.

The startling headlines from New York and Washington mostly involve staggering financial titans like Goldman Sachs, Morgan Stanley, and AIG and government plans to stanch the bleeding in financial markets. But the shock waves from the financial meltdown reach into industries far removed from Manhattan money mavens and the government regulators on their tail. Industrial firms, retailers, and even utilities have watched their stock prices sink since the financial crisis mushroomed in mid-September, mostly on worries about the credit crunch and how it might metastasize into the broader economy.

Since Lehman Brothers declared bankruptcy on September 15, sending the markets into a tailspin, the S&P 500 stock index has plummeted and rebounded—twice. Overall, the S&P 500 is down about 3.5 percent from its closing price on September 12, Lehman's last trading day. But since then, more than 20 companies have fallen by 10 percent or more—and fewer than half of them are in the financial sector. Here are the companies whose stock has fallen the most during the crisis:

AIG, down 61 percent. The storied insurance company has become a poster child for the 2008 market meltdown, as multibillion-dollar losses in arcane securities torpedoed otherwise solvent business operations. An $85 billion government loan turned out to be the only thing able to prevent a Chapter 11 filing. Shareholders are pushing to repay the high-rate, two-year loan ahead of time—or even come up with enough cash to forestall the loan altogether—which has caused a minor rally in the distressed stock.

Constellation Energy, down 53 percent. This $21 billion Maryland-based power company went into free fall as concerns about ties to Lehman Brothers, risky commodities trades, and a cutoff of credit led to ratings downgrades and fears of bankruptcy. Two companies—including a division of Warren Buffett's Berkshire Hathaway—are now bidding to buy Constellation.

General Growth Properties, down 42 percent. This Chicago-based real estate investment trust, which develops strip malls and residential communities, faces bad timing: It needs to refinance more than $2 billion in debt by the end of the year, from lenders skittish about anything having to do with real estate. The stock has taken such a pounding that the company has said it may sell assets to boost its share price.

Morgan Stanley, down 27 percent. The once mighty investment bank has contained the damage a bit, by reclassifying itself as a bank holding company and agreeing to sell a 20 percent stake to a Japanese bank. But Morgan has still been battered amid concerns about bad securities it may hold and overall panic in the financial sector.

Ashland, down 25 percent. This Kentucky-based chemical company actually has bigger problems than the wipeout on Wall Street: Gulf Coast disruptions caused by Hurricane Ike have been the main force behind a stock swoon, along with falling prices for its many products because of an overall economic slump.

NetApp Inc., down 23 percent. The stock of this California data-storage firm was outperforming the market until the financial crisis began to make a follow-on recession seem inevitable. One advisory firm cut NetApp's rating, based on expected cutbacks on corporate IT spending, sending the stock into a double-digit decline.

Office Depot, down 22 percent. The office-supply chain doesn't have any heavy exposure to toxic securities or credit defaults, but as economic news worsens, firms catering to business tend to struggle. Office Depot's stock is suffering from the overall market swoon.

AK Steel, down 22 percent. The Ohio-based steelmaker is a second-order victim of the market's gyrations, falling in step with the overall market—then staying there, amid worries that a flagging economy will mean less business.

Goldman Sachs, down 22 percent. Still one of Wall Street's richest firms, Goldman, like Morgan Stanley, is struggling to keep pace with the unpredictable realignment of the financial firmament. Like Morgan, Goldman has reclassified itself as a bank holding company. But its share price fell 7 percent in just one day following that announcement—a sign that investors feel Goldman's best days may be over.

State Street Corp., down 19 percent. A portfolio of complex securities backed by mortgages and other assets caused a minipanic in shares of this Boston-based financial firm, which fell more than 50 percent in one day last week. The stock bounced back when management issued reassurances, but investors are still rattled.