NEW YORK, Feb 9: US stock markets tumbled heavily in the week to Friday, giving Wall Street a fresh battering, despite Congress granting a green light to a giant economic stimulus package sought by the White House.

The plan, worth around $150 billion, is stuffed with temporary tax rebates and business incentives designed to give the economy a boost, but some analysts say the world’s biggest economy is already in a recession.

In the week to Friday, the benchmark blue-chip Dow Jones Industrial Average fell a hefty 4.40 per cent to close at 12,182.13. The leading index is down over eight per cent for the year to date.

The tech-laden Nasdaq composite lost 4.50 per cent to 2,304.85 while the broad market Standard & Poor’s 500 index dropped 4.60 per cent to 1,331.29.

All three stock barometers have ceded significant ground since last August amid an ongoing housing slump and a related credit crunch which have bruised the earnings of major banks and financial firms.

Debate continues to rage over whether the US economy is in recession or not. Some analysts believe the economy is in recession, while others argue that growth is still positive and some economists remain sitting on the fence.

Growth is being threatened by the housing downturn, the credit crunch, and concerns about the job market and consumer spending.

Although Wall Street appeared to give a cautious welcome to the stimulus plan, which White House officials said President George W. Bush would sign into law in the coming week, some economists say it will give growth a needed boost.

This fiscal stimulus package meets the key criteria of being temporary, quick and cost-effective. Therefore, it has the basic ingredients necessary to give the economy a shot-in-the-arm in the second half of 2008, and provide a safety net against a more serious downturn in the economy, said Brian Bethune, an economist at Global Insight.—AFP