Dow briefly drops 500 points

Stocks slumped again on Monday extending the volatility that emerged last week as investors grew more worried about turmoil in the bond market

Stocks slumped again on Monday extending the volatility that emerged last week as investors grew more worried about turmoil in the bond market

The Dow Jones rose 1.4 percent, and the broader S&P 500 was up 1.5 percent on Friday - but ended the week 9 percent below the all-time high set just two weeks ago.

"Based on fundamentals, this is a buying opportunity", he said.

Alexandra Coupe, associate director of USA investment manager PAAMCO, said rising inflation made stocks less attractive.

Nasdaq 100 e-minis were up 51.75 points, or 0.79 percent, on volume of 79,385 contracts. "What we have now is what I call fear of getting caught". Thursday was the fifth consecutive trading day that the Dow fluctuated more than 500 points in intraday trading, a sign of the growing uncertainty and volatility in the market.

Bulls argue that strong US corporate earnings, including a boost from the Trump administration's tax cuts, will ultimately support market valuations.

Wall Street Crash of 1929 which began the previous Thursday continues on Black Monday as the economy starts to worsen.

The price of gold rose $4.40, or 0.3 percent, to $1,319 an ounce.

The price plunge can also be blamed in part on a few disappointing operating results and guidance from key tech companies, even though most major firms have been getting heathy report cards during the current round of earnings reports.

X The S&P 500 dropped to its long-term 200-day moving average, a level it had not reached since July 2016, and found support at that line.

The Dow was up 264 points, or 1.1 percent, at 24,122. That means a drop of 10 percent from a recent peak.

Stocks in Europe declined and bond yields increased after the Bank of England said it could raise interest rates in coming months because of the strong global economy.

The Dow Jones industrial average closed down 4.2 per cent, to close at 23,860, on Friday morning New Zealand time, as investors continued to react to fears that interest rates may be on the rise. Investors are also anxious that the Federal Reserve will increase interest rates. And as Motley explains, "we've also been witnessing a move higher in Treasury yields". Britain's FTSE 100 fell 1.5 percent and the French CAC 40 lost 2 percent. In 1987, the Dow plunged 508 points in one day-and sustained a loss of 22.6%, the largest one-day decline in the Dow's history.

Nicholas Colas, co-founder of DataTrek Research, doesn't think the sell-off will end until bond yields fall sharply.

Thursday's market decline appeared once again tied to the increase in interest rates, with the 10-year Treasury yield touching 2.86% as investors continue to work out what a rising interest rate environment means for stocks after almost a decade of low, stable interest rates and low inflation. Germany's DAX declined 2.6 percent.

"Relative calm in the S&P 500 on Wednesday led to fairly stable markets in Asia on Thursday, but another big US drop in Thursday trading has produced another day of weakness across Asia on Friday", he added.

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