Breaking News
0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

Wall Street tumbles as factory activity hits 10-year low

Stock MarketsOct 01, 2019 04:46PM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters. Traders work on the floor at the NYSE in New York

By Noel Randewich

(Reuters) - The S&P 500 and Dow suffered their worst tumbles in over a month on Tuesday after data showed U.S. factory activity shrank in September to its weakest in over a decade, ratcheting up fears that the U.S.-China trade war is hobbling the world's largest economy.

Investors moved to the safety of U.S. Treasuries after the ISM report showed its manufacturing activity index at 47.8, falling further from August's sharp contraction and below economists' expectations of 50.1. A reading below 50 indicates contraction.

With lingering trade tensions weighing on exports, the U.S. data mirrored similar patterns in the euro zone, Japan, the United Kingdom and China.

The S&P industrials index (SPLRCI) dropped 2.4%, the most among the 11 major S&P sectors. The materials <.SPLRC> and energy (SPNY) indexes both fell 2.3%. All 11 sectors lost ground.

A jobs report on Friday is expected to shed further light on U.S. economic strength.

"This is a bad number, fitting in with the world’s manufacturing recession," Jim Bianco, head of Bianco Research in Chicago, said of the ISM report. "I think the market is right to be concerned, but we will have to see whether other manufacturing numbers in the U.S. bear that out, not the least of which being the manufacturing payroll numbers on Friday."

Despite a prolonged U.S.-China trade war that has hammered global growth, confidence in the domestic economy has helped the benchmark S&P 500 (SPX) climb about 17% this year.

Thomas Simons, a Jefferies economist, said the manufacturing contraction does not underpin a wider softening in the U.S. economy, as it was the result of several factors, including Boeing Co's (N:BA) production issues relating to its best-selling jets.

"Manufacturing itself is in a recession, but it does not mean that the overall economy is in a recession."

The Dow Jones Industrial Average (DJI) fell 1.28% to end at 26,573.04, while the S&P 500 (SPX) lost 1.23% to 2,940.25. Both indexes had their biggest one-day dip since Aug. 23, when U.S. President Donald Trump demanded that American companies seek alternatives to doing business with China.

The Nasdaq Composite (IXIC) dropped 1.13% to end at 7,908.69.

The Cboe Volatility Index, or VIX (VIX), an options-based gauge of investor anxiety, rose 2.3 points to 18.56, its highest close in about a month.

Shares of online brokerage E*Trade Financial (O:ETFC) tumbled 16.4%, the most on the S&P 500, after rival Charles Schwab Corp (N:SCHW) said it would remove commissions for online trading of stocks, ETFs and options listed on U.S. or Canadian exchanges. Charles Schwab's shares slumped 9.7%.

McDonald's Corp (N:MCD) dropped 2.7% after JP Morgan said the fast food chain's third-quarter same-store sales would be softer than analysts' estimates.

Shares of chipmaker Xilinx Inc (O:XLNX) declined 4.1% after KeyBanc lowered its rating to "sector weight."

In one of the few bright spots, Ulta Beauty Inc (O:ULTA) advanced 6.1% after an independent director bought shares.

Stitch Fix (O:SFIX) rose 1% in extended trade after the apparel seller's quarterly earnings per share beat analysts' estimates.

As the final quarter of 2019 kicks off, investors will be focusing on a range of factors, beginning with the high-stakes Sino-U.S. trade talks in early October, corporate earnings and the Fed's next policy meeting.

Declining issues outnumbered advancing ones on the NYSE by a 2.76-to-1 ratio; on Nasdaq, a 3.29-to-1 ratio favored decliners.

The S&P 500 posted 12 new 52-week highs and 9 new lows; the Nasdaq Composite recorded 28 new highs and 131 new lows.

Volume on U.S. exchanges was 7.3 billion shares, compared with the 7.2 billion average for the full session over the last 20 trading days.

Wall Street tumbles as factory activity hits 10-year low
 

Related Articles

Volaris in El Salvador set to accept bitcoin
Volaris in El Salvador set to accept bitcoin By Reuters - Oct 19, 2021

SAN SALVADOR (Reuters) - Low-cost airline Volaris will accept bitcoin in El Salvador, Salvadoran President Nayib Bukele said Tuesday. "This allows us to increase the offering of...

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Comments (15)
Seth Thomas
Seth Thomas Oct 01, 2019 7:23PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Raise your hand if you're "sick of winning."
Klaus Weyers
Klaus Weyers Oct 01, 2019 6:03PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
i said last 4 days to sell any rally.. worked like a charm.. going to add to my shorts on every bounce tomorrow.. target 25000 in Dow, stop.. 26716
Timothy Yap
Timothy Yap Oct 01, 2019 4:13PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Economic adviser Peter Navarro causing this mess!!!
Herra Peruna
Herra Peruna Oct 01, 2019 2:09PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
when there is blood in the streets its time to buy!
Ivan Couto Jr
Ivan Couto Jr Oct 01, 2019 1:32PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
all this environment is caused by american socialists that are not buying equities anymore. Stop traveling, stop drinking, stop everything, bet all in in stocks. This is the solution
Duane Lee
Duane Lee Oct 01, 2019 1:32PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
I'm not a socialist but I'm not buying at ATH prices in the face of debt bubbling.
Adrian White
Adrian White Oct 01, 2019 1:32PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
It has nothing to do with "Socialists" lol. It's more related to the stupid Trump trade wars, and the fact that the market is reaching the peak of an exeptionally long bull run.
Al Vlaj
alvlaj Oct 01, 2019 1:32PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
That’s what everyone was saying in 2007. Think about this. From Bear Stearns to Lehman, the S&P 500 rallied. Why? Complacency similar to yours.
Neetesh Jain
Neetesh Jain Oct 01, 2019 1:15PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Deal or no deal with US- China is important, but hangover is causing a pause in markets.No clear direction for market's.
Brad Dover
Brad Dover Oct 01, 2019 1:08PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
trump is just the greatest. the biggest . the best. . . I cannot believe all this MAGA his is doing
Mike Roland
Mike Roland Oct 01, 2019 1:08PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
you mean CACA
Zack Persie
Zack Persie Oct 01, 2019 12:55PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
And Trump keep bragging nonsense about winning trade war with US economy remaining strong. Clearly trade war & Trump's tariff are hurting both US & China. Truth is US cannot hope to hurt China without hurting itself. It will get much worse if Trump is allowed to continue his reckless ways.
Al Vlaj
alvlaj Oct 01, 2019 12:55PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
It’s like during the Vietnam War. US government kept saying we were “winning” because we lost “only” 58,000 troops and they lost 1.1mm. Guess what. We were losing. And the US government knew it.
Jack Zhang
Jack_A Oct 01, 2019 12:35PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
"this is fake news. we have the best economy ever"
Delonte Crosby
Delonte Crosby Oct 01, 2019 12:25PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
If one thing messes up people from buying then let it get low enough then buy back at a cheaper price rather then let the whole market fall cause of one reported. Let it slip a little but get it back for a cheaper price then watch it go up.Get afraid over what a statement says every time and stuff falls apart in this market.
Rico Su
Rico Su Oct 01, 2019 12:15PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Trump, keep doing the trade war and see what the data looks like in October
Kenny Venezia
Kenny Venezia Oct 01, 2019 12:14PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
ya, but it's the new fiscal year today & all those trick accounting practices have to actually use math and the real numbers have to be reported.
Jason Patcher
Jason Patcher Oct 01, 2019 11:58AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Trump for fed!
Hendra Bong
Hendra Bong Oct 01, 2019 11:54AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Who wins the trade war between US and China from the data ?
kapil kumar
kapil kumar Oct 01, 2019 11:54AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
no one is winning trade warend results - who suffers most
Bryan Lee
Bryan Lee Oct 01, 2019 11:50AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
This was expected since Boeing can't churn out their lead airplanes.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email