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Wall Street closes down 3.6%, worst plunge since 2011
RT,
24
August, 2015
US
stocks closed with the Dow Jones Industrial Average down 588 points,
recovering from the shocking plunge of 1,000 points at the opening
bell on Monday. The S&P 500 was down over 77 points as the
trading stopped on the busiest day of the year for investors.
Wall
Street suffered one of the steepest falls in the last four years. The
volatile session saw the main indexes plunge by 5 percent during the
day before correcting and closing down nearly 4 percent. The Dow
opened with a stomach-churning 1,000-point plunge following world
market panic and the biggest Chinese stock slide since 2007.
What a strange day: Dow went on a roller coaster after a flash crash at the opening of >1000points. Closes 3.6% lower pic.twitter.com/GjOE0F7lhV
— Holger Zschaepitz (@Schuldensuehner) August 24, 2015
More
than 2,000 stocks hit new 52 week lows on Monday, according to the
WSJ Market Data Group. Nasdaq saw Apple fall as low as $92. Giants
such as Chevron, General Electric, Berkshire Hathaway and PepsiCo
have seen their lowest stock prices on the New York Stock Exchange in
a year.
The
Dow’s 588 points loss corresponded to a 3.6 percent decline while
the S&P 500’s 77 points drop corresponds to a 3.9 percent loss.
The Nasdaq Composite ended the day with a 3.8 percent drop, down
nearly 180 points.
According
to preliminary data from BATS Global Markets, the US equities market
operator, nearly 1,300 trading halts were recorded on US exchanges on
Monday.
Though
the Dow percentage change may not be dramatic, the 588 point
drop is the eighth-biggest intraday point decline in the Dow’s
history while the 1,000-point decline at the open is the largest
intraday point decline in history.
*S&P
500 DROPS 3.9%, ENTERS CORRECTION FOR FIRST TIME SINCE '11
— lemasabachthani (@lemasabachthani) August 24, 2015
The
US stock chaos followed the crash of the world markets on Monday,
after the Shanghai composite closed down 8.5 percent. Asian markets
followed China with a broad sell-off. Europe mirrored the downtrend,
with the STOXX Europe 600 Index dropping 5.3 percent – its worst
percentage loss since 2008.
READ
MORE: ‘It’s
a bloodbath’: Markets plunge worldwide after biggest slide in
Chinese stocks since 2007
"The
catalyst for recent declines in stock markets and commodity prices is
a downbeat reassessment of the global economic situation due to
China’s recent currency devaluation. The Chinese move to peg the
Yuan lower caught markets by surprise and has caused many analysts to
question whether China could meet its lofty economic growth
forecasts,"Edward
Harrison, banking and finance specialist at Global Macro Advisors,
told RT
New Zealand
25
August, 2015
The New Zealand share market opened sharply weaker for the second day in a row as investors worldwide continued to offload their shares in the wake of extreme market volatility in the world's second biggest economy - China.
In
the opening minutes of trade, the S&P/NZX 50 Index was at
5,473.5, down 134 points or 2.4 per cent.
On
Monday, the index lost 143 points, or 2.49 per cent, to 5616, and
about $2.25 billion was shaved off the market's total market
capitalisation.
In
the United States, the Dow Jones Industrial Average finished nearly
600 points down to its lowest closing point since February 2014. The
index had dropped by just over 1,000 points in the first few minutes
of trade.
Read
more:
• NZ dollar hits lowest level since July 2009
• Hour of panic as GE plunges 21pc - markets flirt with abyss
• NZ dollar hits lowest level since July 2009
• Hour of panic as GE plunges 21pc - markets flirt with abyss
The
major British and European markets were down by 3 to 5 per cent,
after the Shanghai Composite index dropped by 8.5 per cent as worries
about a slowing Chinese economy took hold.
The
New Zealand dollar slumped to its lowest level in six years as
equities sank amid concerns about global growth.
Shane
Solly, portfolio manager and research analyst at Harbour Asset
Management, said another day of selling was likely for the local
market.
"It
was obviously another rough night on the markets globally," he
said.
"We have seen a retracement on the back of changes in the Chinese economy," he said, adding there were rising concerns about global growth, as well as growth in China and in the other emerging markets.
"We have seen a retracement on the back of changes in the Chinese economy," he said, adding there were rising concerns about global growth, as well as growth in China and in the other emerging markets.
"We
have had a very strong run in the capital markets in the last three
years and it's not a surprise to see it falling back, but we are
going to see more volatility," he said.
Fund
managers said that while the local market could expect to see more
turbulence arising from volatility in offshore markets, the New
Zealand economy was in better shape than many of its peers.
Furthermore, the Reserve Bank had more leeway to cut official
interest rates if there is a marked turn for the worse. The official
cash rate stands at 3 per cent.
Read
more:
• Apple CEO talks as shares plunge, then recover
• Wall St tumbles as China syndrome rocks world markets
• Apple CEO talks as shares plunge, then recover
• Wall St tumbles as China syndrome rocks world markets
See
this AP interactive on recent US sharemarket trends:
The
kiwi touched 62.44 US cents overnight, its lowest level since July
2009, amid low liquidity, and was trading at 64.90 cents at 8am in
Wellington, from 65.89 cents at 5pm yesterday.
Fund
managers said that while the local market could expect to see more
turbulence arising from volatility in offshore markets, the New
Zealand economy was in better shape than many of its peers.
Furthermore, the Reserve Bank had more leeway to cut official
interest rates if there is a marked turn for the worse. The official
cash rate stands at 3 per cent.
Four
reasons the NZX wasn't hit as hard:
• Much of the weakness overseas is related to oil and resources, which do not feature strongly on the NZX.
• The economy is generally in better shape than many of its peers.
• There are still levers to pull if the economy does worsen from here - such as lower interest rates and a lower exchange rate.
• The company reporting season has seen some solid results, which has helped to offset some of the weakness.
Australia
Wall Street crashes in sharp sell-off
A
wave of selling has gripped global markets overnight, setting up
another bloodbath today in Australia.
US
stocks joined selloffs in Europe and Asia, with the Standard &
Poor's 500 Index tumbling toward its first correction in almost four
years. Chinese shares sank the most since 2007 and stocks in Germany
headed for a bear market.
Commodities
fell to a 16-year low as crude plunged 4.1 per cent. The yen
strengthened and 10-year Treasury yields slid below 2 per cent for
the first time since April.
Markets Live: Horror night to hit ASX
After
one of the worst days on record shares look set to plunge again at
the open after another torrid night of trading, ahead of BHP's annual
earnings
And
here's what you need2know:
- SPI futures down 181 points to 4770
- AUD at 71.32 US cents, 84.77 Japanese yen, 61.61 Euro cents and 45.35 British pence
- On Wall St, S&P 500 -3.9%, Dow -3.6%, Nasdaq -3.8%
- In New York, JPMorgan -5.3%, Chevron -4.3%, Apple -2.5%
- In Europe, Stoxx 50 -5.4%, FTSE -4.7%, CAC -5.4%, DAX -4.7%
- In London, Glencore -13%, BHP -9.2%, Rio -6.9%
- Spot gold down $US6.62 or 0.6% to $US1154.15 an ounce
- Brent crude fell $US2.91 or 6.4% to $US42.55 a barrel
- Iron ore slumped 5% to $US53.28 a dry ton
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