The Dow tumbles more than 400 points

12 October, 2018, 04:43 | Author: Corey Lynch
  • Wall Street slumps as investors dump tech stocks

The S&P 500 also fell 3.3 percent, marking its fifth straight decline, and the Nasdaq declined more than 4 percent, its worst percentage decline since June 2016. The Stoxx Europe 600 was down by 1 percent, with London's FTSE 100 down by a similar percentage.

US stocks posted their worst loss since February on Wednesday, the Dow Jones industrial average finishing the day down more than 800 points. Technology companies were among the losers, with the Nasdaq Composite dropping more than 2% to 7,575.34. The Russell 2000 index of smaller-company stocks fell 30.03 points, or 1.9 percent, to 1,545.38.

US consumer prices rose less than analysts had forecast in September, reducing expectations the pace of inflation is accelerating despite a tightening labor market. Industrial and internet companies also fell hard.

Bond yields and therefore interest rates have been rising for more than two years as the USA economy grew strong.

A global measure of equity prices fell to a 1-year low on Thursday as Wall Street extended its October slide into a sixth session as investors feared an escalating US trade war with China and risks from a recent climb in interest rates. "I don't think so", he said.

The declines - which brought the major indices to their lowest levels in months - came as US President Donald Trump repeatedly castigated the Federal Reserve for lifting interest rates, sparking worry that the US central bank's independence from politics could be compromised.

"We have interest rates going up at a clip that's much faster than certainly a lot of people, including myself, would have anticipated. They're so tight. I think the Fed has gone insane", he told reporters while traveling in Pennsylvania on Wednesday. He continued to attack Fed Chair Jerome Powell Thursday, saying he was "disappointed" in "far too stringent" rate hike decisions.




Rising government bond yields have made them more attractive, leading investors to pull money out of equities.

Benchmark U.S. 10-year Treasury notes rose late in the day, pushing yields down to 3.1931 percent.

Amazon dropped another 3.4 percent to $1,694.01 and Apple fell 1.4 percent to $213.25.

Augustine added that with earnings due out from big banks JPMorgan Chase (JPM), Citigroup (C) and Wells Fargo (WFC) on Friday morning, investors will look for new market sectors to take the lead from tech stocks. Technology companies and retailers, including longtime market favorites Apple, Alphabet and Amazon, continue to slide.

The two-day 4.7-percent drop in the SPDR S&P 500 ETF (NYSE: SPY) comes after the S&P 500 gained 22.2 percent in the previous 18 months. Microsoft and Alphabet, Google's parent company, were little changed.

The renminbi had fallen "significantly" during the year and the Treasury Department is monitoring this "very carefully" to make sure China wasn't manipulating its currency to gain an advantage in the trade war, Mnuchin told the Financial Times in an interview. Facebook, the sixth-largest company, has tumbled 29 percent since late July, surpassing the 20-percent threshold for a "bear market". Australia's S&P/ASX 200 slipped 2.4 percent to 5,906.00.

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