NEW YORK — Wall Street has turned the clock back to 1997.

Investors unable to extinguish their worries about a recession that has no end in sight dumped stocks again Monday. The Dow Jones industrial average tumbled 251 points to its lowest close since May 7, 1997, while the Standard & Poor's 500 index logged its lowest finish since April 11, 1997. It's as if the decade's dot-com surge, collapse and subsequent recovery never occurred.

The Dow is just over 100 points from 7,000. Both indexes have lost about half their value since hitting record highs in October 2007.

"People left and right are throwing in the towel," said Keith Springer, president of Capital Financial Advisory Services.

Investors pounded most financial stocks even as government agencies led by the Treasury Department said they would launch a revamped bank rescue program this week. The plan includes the option of increasing government ownership in financial institutions without having to pour more taxpayer money into them.

Although the government has said it doesn't want to nationalize banks, many investors are clearly still concerned that this could be a possibility as banks continue to suffer severe losses because of the recession. They're also worried that banks' losses will keep escalating as the recession sends more borrowers into default.

"The biggest thing I see here is the incredible pessimism," Springer said. "The government is doing a lousy job of alleviating fears."

The Treasury and other agencies issued a statement after The Wall Street Journal reported Citigroup is in talks for the government to boost its stake in the bank to as much as 40 percent.

Analysts said the market, which initially rose on the statement, wanted more details of the government's plans.

"It's only a very partial picture of what we may get," said Quincy Krosby, chief investment strategist at The Hartford. "This proverbial lack of clarity is damaging market psychology."

Meanwhile, technology stocks fell after The Journal reported that Yahoo Inc.'s new chief executive plans to reorganize the company. But the selling came across the market as pessimism about the recession and its toll on companies deepened.

"There's nowhere to hide anymore," said Jim Herrick, director of equity trading at Baird & Co.

The market's decline extends massive losses from last week when the major stock indexes tumbled more than 6 percent. While falling to their 1997 levels, the major indexes plunged through the lows they reached in late November, at the height of the credit crisis.

"There's no main driver of the down day," said Ryan Detrick, senior technical strategist at Schaeffer's Investment Research.

"There's just so much skepticism in the overall market and (the question is) is the government doing proper things to get us out of this problem. Obviously the stock market is voting no."

The Dow dropped 250.89, or 3.41 percent, to 7,114.78. It last closed this low on May 7, 1997, when it finished at 7,085.65. The Dow hasn't traded below the 7,000 mark since October 1997. The index is down 14 percent over the past 10 sessions.

The Standard & Poor's 500 index fell 26.72, or 3.47 percent, to 743.33. It was the lowest close since April 11, 1997, when it ended at 737.65.

When the indexes were last at these levels, they were in their ascendancy, climbing amid the dot-com boom. But 1997 was also the year that saw stock prices later plunge amid a growing financial crisis in Asia.

On Monday, the S&P 500 did close above its Nov. 21 trading low of 741.02. But the 14-month recession has decimated the major indexes: The Dow is down 49.8 percent from its record highs of October 2007, and the S&P 500 index is down 52.5 percent.

Detrick warned that a move below the S&P's Nov. 21 low could set off "violent selling" as even more confidence drains.

The technology-laden Nasdaq composite index dropped 53.51, or 3.71 percent, to 1,387.72.

By the numbers

Dow on Monday:

* Fell three straight sessions, eight of the last 10

* Down 14.08% over the 10-day period.

* Hit an intraday high of 7,441.02 at 9:39 a.m., up 75.35 points, or 1.02%.

* Hit an intraday low of 7,105.94 at 3:52, down 259.73 points, or 3.53%.

*The market capitalization of the Dow fell $77.1 billion.

* Down 7049.75 points, or 49.77% from its record close of 14,164.53 on Oct. 9, 2007.

* Off 43.40% over the past 52 weeks.

* Down 11.07% this month. In January the Dow closed down 8.84%.

What they're saying

The Rocky Mountain News asked investment pros to comment on Wall Street's slide:

Is it too late to sell?

* David Twibell, Colorado Capital Bank: It's never too late to sell. Just make sure you are doing it with a clear head. If you're selling because you have too much equity exposure, then by all means do so regardless of market conditions. If you're selling out of fear, just make sure you've thought through the decision. This an incredibly treacherous market, and anyone who makes decisions based on emotion rather than analysis is going to have trouble.

* Jeff Wilson, Wilson Advisory Group: No. The Dow can easily fall to 5,000 and the S&P 500 to 600. Some stocks i.e. autos, financials, etc. may fall to zero.

* G. Todd Gervasini, Wakefield Asset Management: Yes. If you have a time horizon of five years or longer, yes, it is likely a poor decision to sell. The market is down over 50 percent. Can it get worse? Absolutely. But if you sell, at what point would you get back in? What is your sign to buy? If your time horizon is short, unfortunately you should have never been in the market, and that mistake is going to be costly.

*Fred Taylor, Northstar Investment Advisors: If your time horizon is shorter than five years and your money is invested in nonretirement accounts, then you need to play it safe. No one knows how bad the economy will get or how low the stock markets will go. One has to remember that the U.S. stock market fell 90 percent during the Depression and the Japanese stock market is still down 80 percent from the highs. If at some point within five years you need money to fund college tuition, meet payroll, refinance a mortgage or buy a home, then you cannot afford to take the risk that the Dow doesn't drop to 5,000.

What can investors do for a safe haven right now?

* Michael Serota, Raymond James & Associates: Dividend-yielding companies, with no debt and lots of cash. High-grade corporate bonds and municipal bonds have shown good short-term results.

* Jerry Paul, Essential Advisers: There are several special situations in closed-end bond funds where you not only have low volatility but also tax-advantaged yields with the prospect of some capital gains. These are funds that are liquidating, open ending or conducting tenders for shares that can currently be purchased at discounts of 4-5 percent of their current asset value. The "event" will result in the current asset value being realized.

* Jim Jansson, RBC Wealth Management: Cash, conservative money market funds, government-guaranteed paper all strike me as safe havens. Don't worry about missing a market bottom by being in a haven investment. The last bull market we had lasted nearly five years so there should be plenty of time to get back into it. In fact, if you are risk adverse, don't even think about getting back into it until the leading economic indicators have clearly turned up.

If a parent has a college fund for a 16-year-old that's got 80 percent of four year's worth of full tuition in it, what percentage of the fund should be in equities right now?

* Don Cassidy, Retirement Investing Institute: For absolute maximum safety, 0 percent in equities, although this will prevent any upside recovery opportunity. A compromise position would have 40 percent in equities, since having 60 percent in cash-type items would mean 48 percent of entire need for the four years, and therefore essentially 100 percent of first two years, would be safe, after earning a little interest. That still leaves some room for recovery in the balance of fund.

* Jeff Tjornehoj, Lipper: If you have 80 percent left after last year's calamity, I'd say you're doing just fine. Personally, I think a laddered portfolio of CDs would be very safe, though you may fall a bit short of 100 percent tuition by the fourth year. And that's what summer jobs are for.

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