Get 40% Off
🚨 Volatile Markets? Find Hidden Gems for Serious OutperformanceFind Stocks Now

Stocks - Dow Drops 800+ Points as Tech Wreck, Rate Fears Trigger Bloodbath

Published 10/10/2018, 03:56 PM
Updated 10/10/2018, 04:15 PM
© Reuters.  The Dow suffered its worst day since February on Wednesday.

Investing.com - The Dow suffered its worst day since February as fears of rising interest rates and a meltdown in tech shares prompted investors to flee risk assets.

The Dow Jones Industrial Average fell about 3.15%. The S&P 500 fell 3.29%, while the Nasdaq Composite fell 4.08%.

A sea of red washed over Wall Street as investors shunned risk assets in favor of less riskier ones like bonds, which have become more attractive following a run up in yields.

The 10-year Treasury note yield rallied most of the day on stronger wholesale inflation data, but ended lower as post-auction supply hit the market. On Tuesday, it rose to the highest level since 2011.

The Labor Department said on Wednesday its producer price index for final demand increased 0.2% last month after slipping 0.1% in the prior month. In the 12 months through September, however, the PPI rose 2.6%, below economists' estimates for a 2.8% increase.

Techs were dragged lower by FAANG stocks, with Amazon.com (NASDAQ:AMZN) and Netflix (NASDAQ:NFLX) leading the decline. Netflix fell more than 8%.

Falling energy stocks, meanwhile, exacerbated the selloff in the broader market as oil prices fell sharply owing to reduced appetite for risk and concerns timid global growth may hurt energy demand.

Retailers offered some solace, bucking the trend lower as investors bet that U.S.-focused companies would better weather a potential slowdown in global growth.

Kohl’s (NYSE:KSS) and Dollar Tree (NASDAQ:DLTR) closed more than 1% higher.

Concerns over growth comes as the IMF lowered its global economic growth forecasts and warned that trade wars and rising import tariffs would weigh on commerce.

3rd party Ad. Not an offer or recommendation by Investing.com. See disclosure here or remove ads .

In corporate news, Alibaba (NYSE:BABA) stock fell nearly 6% after Deutsche Bank (DE:DBKGn) cut its price target on the e-commerce company's stock, citing concerns over a potential slowdown in sales in the third quarter of the year.

"We recently caught up with Alibaba and sensed that the company's September quarter (gross merchandise value) GMV could be softer than the June quarter, somewhat validating the weak July and August online retail sales growth reported earlier by NBS data," Deutsche Bank said.

The slump on Wall Street comes ahead of the start of the third-quarter earnings season, which gets underway in earnest Friday with results from major Wall Street banks.

Top S&P 500 Gainers and Losers Today:

Perrigo (NYSE:PRGO), Dollar Tree (NASDAQ:DLTR) and JM Smucker (NYSE:SJM) were the top S&P 500 gainers for the session.

Tiffany (NYSE:TIF), Twitter (NYSE:TWTR) and Ralph Lauren (NYSE:RL) were among the worst S&P 500 performers of the session.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.