US Market Indexes Fall Further, Dow Closes With -3.15% Loss
Oct 12 2018
The Fed has been raising rates in an effort to prevent inflation because economic growth has been booming. It's expected to do so at least once again before the end of the year.
Oil prices slumped to two-week lows as global stock markets fell, with investor sentiment made more bearish by an industry report showing USA crude inventories rising more than expected. "I think the Fed is out of control", the president said to reporters in the Oval Office.
Most analysts believe the pullback is temporary and that stocks will eventually recover and hit new highs.
The euro and sterling rose, underpinned by optimism for a Brexit deal, while the USA dollar lost ground against a basket of currencies even as US yields hovered near multiyear peaks. -Chinese tariff fight over Beijing's technology policy. The worldwide lender cited trade tensions and emerging markets as it downgraded its global growth forecast for this year and next. Apple shares fell 1.2 percent.
The Dow closed Thursday's session down 2.1 percent at 25,052.83, after dropping 3.1 percent on Wednesday.
USA stocks experienced their worst two-day stretch in years this week, with the Dow dropping 1,200 points on Wednesday and Thursday.
The benchmark S&P 500 and the Dow Jones Industrial Average fell almost 1.5 percent and at the day's low had retreated 3.7 percent and 3.6 percent, respectively, from their all-time highs. Nasdaq composite, which has a high concentration of technology stocks, tumbled 244 points, or 3.2 per cent, to 7,495. The Nasdaq composite skidded 92.99 points, or 1.3 percent, to 7,329.06.
All three indexes hit records between August 30 and October 3, despite the escalating Sino-US trade dispute gnawing at confidence on corporate profit growth through most of the year.
Some of America's biggest tech stocks were caught up in the sell-off, with Netflix (Xetra: 552484 - news) down 8%, Microsoft (Euronext: MSF.NX - news) sliding 5%, Amazon off by 6% and Google's parent company Alphabet (Xetra: ABEA.DE - news) down 5%. That's its steepest downturn since a 10-percent drop in early February.
Francis Tan, an investment strategist at UOB private bank, believes the markets will likely pick up in the US session. Many stock-market observers pin the start of the current bull market, the longest since World War II, at March 9, 2009.
The dollar slipped to 112.17 Japanese yen from 112.27 yen late Wednesday.
The dollar index fell 0.31 per cent, with the euro up 0.4 per cent to $1.1564.
US crude settled down $1.79 at $73.17 per barrel and Brent fell $1.91 to settle at $83.09.