US STOCKS-Wall St slide on global growth fears erases S&P's 2018 gains

US STOCKS-Wall St slide on global growth fears erases S&P's 2018 gains

Reuters  | Dec 06, 2018 22:20

US STOCKS-Wall St slide on global growth fears erases S&P's 2018 gains

(For a live blog on the U.S. stock market, click LIVE/ or type LIVE/ in an Eikon news window.)

* Huawei CFO arrest seen escalating U.S-China trade tensions

* All 11 major S&P sectors drop, with financials biggest drag

* Financials hit by drop in bond yields and rate hike bets

* Lower oil prices hit energy stocks; VIX at highest since Oct 30Indexes drop: Dow 3.10 pct, S&P 2.88 pct, Nasdaq 2.41 pct (Adds comments, updates prices)

By Shreyashi Sanyal

Dec 6 (Reuters) - The S&P 500 and the Dow Jones Industrial Average slipped back into losses for the year on Thursday as U.S. stocks slid on mounting worries of slowing global growth after a fresh twist in China-U.S. tensions as well as falling oil prices and U.S. bond yields.

The Dow sank more than 3 percent, or over 750 points, while the S&P and the Nasdaq shed roughly 2.5 percent, adding to a more than 3 percent tumble for the three indexes on Tuesday.

Canada arrested Chinese smartphone maker Huawei Technologies Co Ltd's HWT.UL chief financial officer for extradition to the United States, casting fresh doubts over the prospect of Beijing and Washington striking a deal on trade tariffs in their 90-day truce period. in the China agreement and the arrest of Huawei CFO is on everybody's mind today and it puts a damper in the trade talks," said Larry Benedict, founder of Opportunistic Trader in Boca Raton, Florida.

Optimism after the trade truce over the weekend boosted Wall Street on Monday, extending a rally from last week when the Federal Reserve signaled the pace of rate increases could slow.

But that optimism faded on Tuesday and, along with a drop in longer-dated U.S Treasury yields, sent the S&P to its biggest single-day percentage drop in about two months.

The drop continued Thursday – the U.S. market was closed on Wednesday – as bond yields and oil prices both slid.

Benchmark 10-year Treasury yield held at three-month lows as traders scaled back bets on the number of rate hikes after data showed the U.S. trade deficit hit a 10-year high in October and that the pace of job growth was moderating. US/ oil prices fell after an OPEC meeting in Vienna over production policy ended without a decision. Earlier the OPEC signaled it may agree to a smaller cut than expected. O/R

All the 11 major S&P sectors were in the red. Technology .SPLRCT fell 2.28, energy .SPNY retreated 3.43 percent, while the trade-sensitive industrials .SPLRCI fell 2.85 percent.

But the biggest drag on the markets was a 3.53 percent-slump in financials .SPSY as bond yields fell and bets of a rate hike were pushed lower.

"If markets keep going down then the Fed is not going to (raises rates)," Benedict said.

At 11:27 a.m. ET, the Dow .DJI was down 776.45 points, or 3.10 percent, at 24,250.62, the S&P 500 .SPX was down 77.81 points, or 2.88 percent, at 2,622.25 and the Nasdaq Composite .IXIC was down 172.30 points, or 2.41 percent, at 6,986.12.

The CBOE Volatility Index .VIX , the most widely followed barometer of expected near-term volatility for the S&P, jumped to its highest since Oct. 30.

Apple Inc AAPL.O fell 3.1 percent and was the biggest drag on the S&P and the Nasdaq, while trade bellwether Boeing (NYSE:BA) Co's BA.N 6.6 percent decline weighed the most on the Dow.

Declining issues outnumbered advancers for a 5.70-to-1 ratio on the NYSE and a 3.34-to-1 ratio on the Nasdaq.

The S&P recorded two new 52-week highs and 68 new lows. The Nasdaq showed seven new highs and 311 new lows.

Related News

Latest comments

Add a Comment
Please wait a minute before you try to comment again.
Discussion
Write a reply...
Please wait a minute before you try to comment again.

Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.

English (USA) English (UK) English (Canada) English (Australia) English (South Africa) Deutsch Español (España) Español (México) Français Italiano Nederlands Português (Portugal) Polski Português (Brasil) Русский Türkçe ‏العربية‏ Ελληνικά Svenska Suomi עברית 日本語 한국어 中文 香港 Bahasa Indonesia Bahasa Melayu ไทย Tiếng Việt हिंदी
Sign out
Are you sure you want to sign out?
NoYes
CancelYes
Saving Changes

+