Dow Jones Falls 545 Points

Friday, 12 Oct, 2018

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.

USA stocks are tumbling for the second consecutive day as the market's recent downturn gets worse. Investors see many of these countries as being vulnerable to higher USA interest rates, which can pull away investment dollars. That will raise the cost of corporate borrowing and could drag on economic growth.

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

Wall Street was hammered on Wednesday as investors dumped high-growth names such as technology and FAANG stocks, with rising Treasury yields and trade-related worries sapping their risk appetite. On Wednesday he said he thought policy makers were "making a mistake" and said the Fed had "gone crazy".

The pullback - particularly for tech stocks - is needed, argued Joe Heider, president of Cirrus Wealth Management. Amazon skidded 4.8 per cent to $1,781.21 (U.S.). Tokyo's Nikkei 225 gave up 3.9 percent and Hong Kong's Hang Seng index shed 3.5 percent.

The dollar index fell 0.17 percent, with the euro up 0.25 percent to $1.1518.

Wholesale gasoline shed 2.7 per cent to $2.02 a gallon.

But Hogan said earnings were also a source of worry because they could showcase the consequences of Trump's trade wars for USA companies, from raising costs of raw materials to forcing enterprises to change supply chains.

Innes, the Singapore-based head of Head of Trading for Asia Pacific with OANDA, attributed the slide to a combination of factors, including the possibility further interest rate hikes and the battle over tariffs between the US and China.

The Dow Jones Industrial Average dropped 507 points, or 2 percent, to 25,090, after falling as much as 698.

However, the technology sector began bouncing back on Thursday, despite the more than 500 point drop, gaining 0.46 percent. The Nasdaq composite, which has a high concentration of technology stocks, tumbled 316 points, or 4.1 percent, to 7,422.

Dow Jones is a stock market index that shows how 30 large, publicly owned companies based in the US.

Gina Martin Adams, chief equity strategist for Bloomberg Intelligence, said the stocks have become more volatile in the last few months because investors have concerns about their future profitability. Boeing lost 4.7 percent to $367.47 and Alphabet, Google's parent company, gave up 5 percent to $1,081.22. Tencent has retreated 43 percent from its high this year and fallen out of the top 10 global companies by market value. "The valuation of US stocks, especially tech stocks, is still pretty high and there could be some profit taking actions now", Tan explained.

USA crude dropped 3 percent while Brent crude, the worldwide standard, dropped 3.4 percent. The contract settled at $73.17 in NY. The pan-European FTSEurofirst 300 index of leading regional shares closed down 1.57 percent.