U.S. and European stocks fell today after bad news from financial services companies and the National Association of Purchasing Management in Chicago announcing its manufacturing index fell.

Here’s a definition of the NAPM index from InvestorWords.com:
A measure of the health of the manufacturing sector, and more generally the overall economy, calculated by surveying purchasing managers for data about new orders, production, employment, deliveries, and inventory, in descending order of importance. It is based on a survey of over 250 companies within 21 industries covering all 50 states and it is released on the first business day of the month at 10 am EST and reflects the previous month’s data. A reading more than 50 percent indicates that manufacturing is growing, while a reading less than 50 percent means it is shrinking. The NAPM index is also thought to be an early indicator of inflationary pressures.

So today’s NAPM index was at 44.5 for February, a drop from January’s 51.5 rate.

Financial services firms that invested in subprime mortgages are starting to claim losses on those investments. Their stock prices show the pain.

The S&;P 500 fell more than 37 points to 1330.63; the Dow Jones Industrial Average fell more than 315 points to 12,266.39.

11 stocks fell for every one that rose on the New York Stock Exchange, according to Bloomberg News.

The DJIA includes 30 actively traded stocks as selected by the editors of the Wall St. Journal. Standard and Poor’s selects the 500 stocks in the S&P 500, which was created in 1957. The 500 stocks are said to represent the stock market as a whole.

If you’ve got money lying around that you don’t need for at least five years, now may be a good time to buy. As the Fed keeps lowering interest rates your savings account’s interest rate will probably continue to fall. As stock prices plummet and you buy, you’re setting the stage for making a nice return when the market gets back on its feet.

Feb. 29, 2008.