Benzinga | Oct 22, 2021 09:06AM EDT

This Day In Market History: Wachovia Shocks Market With $24B Quarterly Loss

Each day, Benzinga takes a look back at a notable market-related moment that occurred on this date.

What Happened? On Oct. 22, 2008, Wachovia Bank stunned Wall Street by reporting a $23.9 billion quarterly loss.

Where The Market Was The Dow Jones Industrial Average traded at 8,519, and the S&P 500 finished the day at 896.78.

What Else Was Going On In The World? In 2008, U.S. President Bush signed the $700 billion Emergency Economic Stabilization Act of 2008. The Sony Corp (NYSE:SNE) Blu-Ray HD format reached 70% market share, winning the battle over the rival HD DVD format. The average price of a new car was $27,958.

Wachovia's Miss Spooks The Street If there's anything worse than a $24 billion loss in a single quarter, it's a $24 billion loss in a quarter in which analysts expected a profit.

When Wachovia took an $18.7 billion goodwill writedown on its mortgage assets and a $6.63 billion hit from credit losses in the third quarter of 2018, investors saw the writing on the wall for other big banks.

The Dow plummeted nearly 700 points on the day of Wachovia's earnings report before finishing the day down 526 points and more than 40% off its 2007 highs. Incredibly, the market was still nearly five months away from its financial crisis bottom in March 2009.

Wachovia was acquired by Wells Fargo & Co (NYSE:WFC) in a deal that closed Dec. 31, 2008. The last Wachovia branches were converted to Wells Fargo banks in 2011.