Dow industrials sink 831 points as tech companies plunge

Dow industrials sink 831 points as tech companies plunge

Dow industrials sink 831 points as tech companies plunge

The broad-based S&P 500 slumped 3.3 percent to end at 2,786.46, while the tech-rich Nasdaq Composite Index plummeted 4.0 percent to finish the session at 7,427.74.

"The stock market in the US has started to take notice, and will continue to, particularly if the speed at which rates rise becomes alarming", Jeffrey Gundlach, chief executive of Doubleline Capital, told Reuters last week.

Investors are also anxious about the ongoing trade war with China and its impact on corporate bottom lines as well as the rising threat of higher interest rates. As the base rate from the Fed increases, the value of existing bonds with low-interest drops, which means when bought they will yield higher given a lower base price (price you paid to acquire them).

West Texas Intermediate has shed almost $4 a barrel since Tuesday, marking its steepest two-day decline in more than three years.

Mona Mahajan, US investment strategist at Allianz Global Investors, said: "The market is digesting the potential that rates moving upwards eventually seep into the real economy in the form of mortgage rates, auto rates, student lending rates".

The pullback - particularly for tech stocks - is needed, argued Joe Heider, president of Cirrus Wealth Management.

The data helped push U.S. Treasury yields to a one-week low, further soothing equity investors. Boeing and Caterpillar have both fallen more than 5% this week as Trump continues to threaten additional tariffs, saying Thursday he could "do a lot more" in his trade war with Beijing. Amazon, Apple, Alphabet and Facebook all fell by between 2.3pc and 3.9pc.

Wholesale gasoline shed 2.7 per cent to $2.02 a gallon. Also known as Wall Street's "fear index", the VIX tends to rise when stocks are down.


Wall Street stocks plunged Wednesday, with major indices losing more than three percent in a selloff prompted by the sudden jump in US interest rates.

The Dow Jones Industrial Average experienced the third worst point decline in its history Wednesday, falling more than 800 points.

MSCI's gauge of stock performance in 47 countries fell 2.2 percent, the pan-European FTSEurofirst 300 index of leading regional share lost 2.1 percent. The Nasdaq dropped more than 4% in the worst percentage decline since June 2016.

The financial sector fell 2.9 percent, also hurt by a 2.7 percent drop in bank stocks a day before three of the biggest banks were to report quarterly results.

Earlier in the day, stocks briefly turned positive before extending their losses.

Amazon lost 6.2 per cent and Netflix gave back 8.4 per cent. The yield on the benchmark 10-year note dropped to 3.13 percent. "Then you had buy-the-dippers coming in here saying this was too much too fast", said Dennis Dick, proprietary trader at Bright Trading Llc In Las Vegas.

The dollar slipped to 112.17 Japanese yen from 112.27 yen late Wednesday. The euro rose to $1.1525 from $1.1496.

USA crude settled down $1.79 at $73.17 per barrel and Brent fell $1.91 to settle at $83.09. The contract settled at $73.17 in NY.

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