US stock index futures down as trading resumes

Why Howard Marks is cautioning investors

The Dow tumbles more than 400 points

Declining issues outnumbered advancers for a 3.18-to-1 ratio on the NYSE and a 2.32-to-1 ratio on the Nasdaq. At 10:15am AEDT on Thursday, the ASX200 index was down by 122.5 points to 5,927.5.

USA stocks plunged to their worst loss in eight months on Wednesday as technology companies continued to drop.

The S&P 500 ITI fell by 4.8 percent as a whole and much of that is attributable to the heavyweight stocks that fell today.

The Nasdaq decline was its worst in percentage terms since the surprise Brexit vote in June 2016. Boeing lost 4.7 percent to $367.57 and Alphabet, Google's parent company, gave up 4.6 percent to $1,092.16.

The NZX50 fell 1.15 per cent last week and this week is down around 1.8 per cent. But eventually the high rates worry stock investors, as higher rates tend to increase borrowing costs and cut into profit margins.

Stock prices have been hurt by rising interest rates, which have boosted Treasury yields over the last week.

"Investors missing this rate move is tantamount to letting yourself get run over by a glacier", said Mike Terwilliger, portfolio manager of Resource Liquid Alternatives for the Resource Credit Income Fund in NY.

"It's shifting the tectonic plates", said Jack Ablin, chief investment officer at Cresset Wealth Advisors. "As rates move back towards fair value, capital is going to flow eventually out of equity risk taking".

Global interest rates are near all-time lows, while the USA is pushing interest rates higher given recent economic strength, among other things.

Specialist Meric Greenbaum works at his post on the floor of the NYSE.

"The New Zealand market has been declining from its highs for the last few weeks". JPMorgan 's Jason Hunter thinks we may have seen the worst of the news from the bond market, as recent action leaves him "looking for yields to form a bullish reversal pattern near current levels and define the cheaper end of the fourth-quarter 2018 to first-quarter 2019 range".

Although that's largely because the USA economy is so strong, the spike in rates for the benchmark United States 10-Year Treasury has investors wondering if the near-decade-old bull market may finally be ending. When yields rise for that reason, it is generally good for stocks.

The retreat on Wall Street was led by technology stocks, which dropped 2.33 percent, and the trade-sensitive industrial stocks that fell 2.22 percent. Ms Adams said investors have concerns about their future profitability, too.

After a long stretch of relative calm, the stock market has suffered sharp losses over the last week.

Oliver Pursche, vice chairman and chief market strategist at Bruderman Asset Management, in NY, said: "The big concern isn't really what third quarter earnings numbers are, but really what the outlook for the fourth quarter and first quarters are".

The small-cap Russell 2000 index, less sensitive than its larger peers to global worries such as trade and yields, was down 1 per cent at 1,605.60 points, below its 200-day moving average.

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