US markets plunge into correction territory with Nasdaq tech-wreck leading the way

Wall Street opened sharply lower on Friday, weighed down by a dramatic fall in stock prices of American technology companies. The US markets have now entered correction territory, down over 10 percent from September highs.

The tech-heavy Nasdaq index plunged over 3 percent in early trading. Dow Jones was lower by 2 percent at over 500 points, while the S&P 500 sank more than 2.5 percent.

Shares in Amazon plunged 8 percent, while Alphabet fell 2.7 percent. Facebook, Netflix, and Apple were all losing more than 1.5 percent.

"When the stocks that are carrying the markets begin to crack, investors are going take cover. Investors are waiting for more visibility for things to see where the rotation takes them," said Andre Bakhos, managing director at New Vines Capital LLC in Bernardsville, New Jersey, as quoted by Reuters.

Amazon's revenue from international business, which accounts for 27.5 percent of total sales, was hit the hardest, with growth falling by half to 13.4 percent compared to the previous quarter.

“We don't see any real structural issue with Amazon but nearly every line in the business is decelerating a tad, and we typically see another deceleration in retail in 4Q, hence are struggling to identify a catalyst,”Barclays analyst Ross Sandler said, as quoted by Reuters.

The US economy slowed down less than analysts had expected. It grew at a 3.5 percent annualized rate in the third quarter of the year. A trade war has caused a drop in soybean exports, but it was partly offset by the strongest consumer spending in nearly four years.

“This is seen as a slight positive. There's less pressure on the Federal Reserve to do something [on interest rates],” Bakhos said.

Friday’s selloff comes after US indices rallied in the previous session, but are still down this week. The S&P 500 and Dow dipped 2.2 percent and 1.8 percent this week, respectively, entering Friday’s session. The October stock plunge has erased all gains seen in US markets this year.

https://www.rt.com/business/442369-us-markets-plunge-into-correction/

US market meltdown wipes out 2018 gains as Trump trade wars take toll on stocks

American equities faced another major selloff on Wednesday. It was one of the worst trading sessions for US stocks in years, erasing all gains seen in 2018. Analysts name President Donald Trump’s trade wars as one of the reasons.

The Dow Jones Industrial Average fell 608 points, or 2.4 percent, to 24,583.42. The S&P 500 plunged 84.59 points, or 3.1 percent, to 2,656.10, marking sixth straight losing session.

Meanwhile, the Nasdaq Composite Index dipped 329.14 points, or 4.4 percent, to 7108.4.

The tech-heavy index is more than 10 percent below its August 29 all-time high, entering the correction territory. Wednesday was the worst day for the Nasdaq since August 18, 2011.

“What is happening on Wall Street is hardly surprising. The US is implementing a sharp monetary policy and is waging foreign trade wars against everyone. In such conditions it becomes harder and harder to grow. There is still room for correction in the US, so we are waiting for the development of the situation,” Roman Blinov, head of analytical department at International Financial Center said in an email to RT.

The analyst also noted corporate earnings disappointment in the US, a growing conflict over budget spending between Italy and the European Union, and growing crisis around oil power Saudi Arabia over the killing of journalist Jamal Khashoggi.

The selloff on Wall Street dragged down some global markets as well. The standout loser, Thursday, was Japan’s Nikkei index, which lost 3.72 percent. In China, Shanghai composite traded slightly higher at 0.5 percent, while stock indices in Europe were either trading flat or showing modest gains.

https://www.rt.com/business/442232-us-market-meltdown-stocks/