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US stocks drop after Bernanke warning

Stocks are down sharply after Federal Reserve Chairman Ben Bernanke warned that the U.S. economy is "unusually uncertain".

Bernanke has told Congress that the economy is fragile, but he is also not expecting it to fall back into recession.

The Fed chairman has confirmed investors' fears that the economy has been weakening. Investors have been selling stocks since late April on a combination of weak economic indicators and disappointing earnings reports.

 

In midafternoon, the Dow Jones industrial average was down 90 points, or 0.9 percent, at 10,139. The broader Standard & Poor's 500 index is down 10, or 1 percent, at 1,072. The Nasdaq composite index is down 22, or 1 percent, at 2,200.

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