China’s market slid 9% early. Major correction underway as economy slowdown has occured faster than anticipated.
So I read.
Re: Dow down 500+ points
It finally closed 415 points down
certainly the worst day in years....
Re: Dow down 500+ points
worst in 5 years...
Re: Dow down 500+ points
Correction was overdue. Profits being locked in.
Re: Dow down 500+ points
true, it still needs to come down more, way more, to 10,000 level.
Re: Dow down 500+ points
**World stocks plummet on China woe**
Global stock markets have slumped, with the US Dow Jones index plummeting by more than 400 points and London’s FTSE 100 index also posting sharp losses.
The sell-off was sparked by a near-9% slide on the Shanghai Composite Index, as investors worried that China may pass rules to limit demand for stocks.
The Dow Jones fell more than 500 points at one point, before closing down 416.02 points, or 3.29%, at 12,216.24.
The FTSE 100 closed on a fall of 2.3%, or 148.6 points, to 6,286.1.
Elsewhere on Wall Street, the technology-laden Nasdaq index closed down 3.86% at 2,407.87, while the S&P 500 index closed down 3.47% at 1,399.04.
The New York Stock Exchange instituted trading curbs at 1303 EST (1803 GMT) in a bid to stem falls on the US stock market, although the move was not enough to prevent the Dow plunging nearly 300 points in a matter or minutes in late trading.
European markets suffered as well, with the main indexes of the Paris and Frankfurt stock exchanges shedding about 3% each.
Earlier in the day, Hong Kong’s Hang Seng index had ended trading on a loss of 1.8%, while Japan’s Nikkei 225 index slid 0.5%.
“The sell-off in China continues to have a profound effect on stocks across the board, since the largest unwinding in the Shanghai Composite Index since 1997 leaves investors questioning the sustainability of stock gains everywhere,” said analysts at Briefing.com.
The eyes of investors will now be on Asian markets to see whether the investor panic spreads. If that happens, European and US markets could face another round of sell-offs.
The first stock market to open the new trading day in the Asia-Pacific region, New Zealand, saw key share prices plunge nearly 3% during the first hour.
‘Sense of panic’
Investor sentiment on Wall Street was also knocked by figures showing that US growth may be slowing down more than anticipated, with a government report earlier showing that orders for durable goods in January had dropped by the largest amount in three months.
“As the afternoon has progressed, there seems to be a sense of panic among some professional investors,” said Andre Bakhos, president of Princeton Financial Group.
“There seems to be just an air of nothing is safe anymore, there’s nowhere to go and people are rotating into bonds as a safe haven.”
China has been one of the main emerging markets for many investors as the country’s economy has grown strongly and the government has sold stakes in some of its biggest and most attractive companies.
However, the government has been looking at ways of slowing growth in order to stop the economy from overheating, and many investors are worried that it may lead to tougher regulations that will limit stock-market investment.
At the same time, there are concerns that interest rates will have to be raised in order to rein in economic and price growth, further denting domestic demand for shares.
“Foreign companies which are particularly exposed to China have been badly affected,” said Peter Dixon, an economist at Commerzbank.
“These companies basically will suffer in the event of things going sour in the Chinese market.”
Standard Chartered, a lender that focuses on emerging markets, was one of the biggest UK decliners on Tuesday despite reporting earnings that topped analysts’ forecasts.
Standard Chartered was down 4% at 1,450 pence.
Digging down
Also hurting UK shares was a newspaper report that South Africa may consider asking companies in the mining industry to pay an extra tax.
The news hit shares of mining firms, with Xstrata losing 6.7%, Vedanta Resources shedding 4.9%, Anglo American down 4.7%, BHP Billiton falling 6.2%, and Rio Tinto sliding 4.8%.
South African newspaper Business Day said the government may ask mining companies to pay an additional tax on top of the royalties they already pay when commodity prices climb above a certain level. Commodity prices have climbed to record levels in recent months.
Re: Dow down 500+ points
What about tomorrow? Could this be considered a buying opportunity or you see this down trend to continue?
Re: Dow down 500+ points
^ I wouldn't buy yet. Wait and see where the market bottoms.
Re: Dow down 500+ points
FTSE is down over 100 points this morning after closng down over 100 points yesterday. However, Dow futures are positive at the moment.
Re: Dow down 500+ points
Alan Greenspan former chairman of Federal Reserve has a lot of creditability in my eyes. He warned that there is a danger of the U.S slipping into a recession. The next few months will be interesting.
Interest rates in the U.K are expected to go up a bit more. China is also trying to apply brakes on its growth. I think that world growth would slow down as major economies slow down.
Re: Dow down 500+ points
dollar is getting screwed by euro and pound thats one reason.
Re: Dow down 500+ points
World stock slump hits second day
Worldwide share prices have continued to fall, triggered by Tuesday’s 9% losses on the Shanghai stock market.
The UK’s FTSE 100 index fell by 1% in morning trading. That took declines in the past two sessions to 3.2% and knocked £52bn off its total value.
France’s Cac 40 index dropped by 1% and Germany’s Dax lost 1.1%. Earlier, markets in Asia, Australia and India had all suffered substantial losses.
Investors are questioning the outlook for economic and earnings growth.
The current global stock sell-off was fuelled by speculation that China’s government would try to clamp down on illegal share trading and might impose a capital gains tax on stock market earnings.
Stock prices and indexes had climbed to record levels in a number of key world markets, prompting some analysts to fear that shares may have gone too high, too fast.
After a flurry of activity at the start of trading and a large drop, the FTSE 100 rebounded slightly and was recently 61.80 points lower at 6,224.30.
In Japan, the Nikkei 225 share index closed down 515.8, or 2.9%, lower at 17,604.1, while in Hong Kong the Hang Seng index fell 496.36, or 2.5%, to 19,716.5.
**
More declines?**
The question facing many investors is how far and how long the fall in prices will last and whether or not the bull run that has driven stocks and indexes higher has now broken.
“I see it as a correction within a bull market,” said James Hong, head of equity derivatives trading at Dresdner Kleinwort.
“We were looking for some sort of correction overall. It is a little bit surprising to have it all happen at the same time.”
Even if a market’s upwards trend is not broken, a market correction can still be significant, analysts said.
In May last year, the UK’s FTSE 100 lost more than 9% as concerns about high oil prices and political global instability combined to impact on world markets.
**
Wide impact**
China has been one of the main emerging markets for many investors, and its main stock index had more than doubled in value during the past year.
At the same time, key indexes in Asia such as Japan’s Nikkei 225 were pushing to their highest levels in seven years.
Some analysts fear the fall in share prices may last a number of weeks rather than days.
“This sort of move by the market is a little worrying, and it looks like it has been caused by a build-up of concerns in recent days,” said Angus Campbell, a trader at Finspreads.
“Memories of last May’s correction have sent shivers through investors’ spines as many market participants have used futures contracts to run for cover.”
The worries hammered China’s Shanghai index by nearly 9% on Tuesday, giving it its worst day in a decade.
The China wobble rippled out across Europe on Tuesday, and hit the US later in the day where it coupled with disappointing economic figures to push the Dow Jones 3.3% lower by the close of trading.
Asian markets then picked up on this negative sentiment, and by early Wednesday India’s Sensex fell more than 3.8%.
Australia’s main stock index shed as much as 3.5% and at one point was trading at a five-week low, before closing down 2.7%.
Re: Dow down 500+ points
One of the reason for greater volatility in the stock markets in recent years has been the rise in popularity of hedge funds.
Re: Dow down 500+ points
And what are hedge funds?
Today my portfolio recovered 50% from yesterday's hit.
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European markets are heavily down again. There was a mild recovery in the dow yesterday, remains to be seen if the recovery continues today.
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hello,
by my is the loss also huge in 1 week. from 107 to 99,0. loss of 7%....is this temporary and it will be good? because i am always dare ... this correction and maybe the warr in iran. Should i sell or should i take the loss and sold it and wait till it rise?
sorry for my English
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the only saving grace is that the funds I invest in were smarter than I and took profits, so I guess what I lost on my own is covered by the funds..*whew
Re: Dow down 500+ points
The Dow closed another 120 points to end the week 520 points down at 12114.
Where next?
I think the slide will continue as the market corrects it recent overstretched positions to the up and also the nervousness about China contiues.
Re: Dow down 500+ points
i think its like Mutual Funds - the difference is that it doesn't allow more than 100 investers. so the minimum investment amount is higher too.
so more profits.
I would like some details too if someone knows about it.