Sunday, 23 September 2018
Latest news
Main » Dow closes up 567 points after a rocky day

Dow closes up 567 points after a rocky day

07 February 2018

Wall Street's Dow Jones and S&P 500 benchmarks had slumped 4.6 percent and 4.1 percent on Monday, their biggest drops since August 2011. The S&P 500 advanced 46 points, or 1.75%, to 2,695.

Neil Wilson, senior market analyst at ETX Capital in London, is anxious about the role technology is playing in the rout. Whether this is a major correction like the one that happened in 2008, or if it's just a healthy, standard correction that happens as a part of normal market cycles, time will certainly tell. He added that as long as the recent rise in bond yields moderates, the bank is confident that market conditions will remain orderly.

The question investors are now asking is whether the worst is over - at least for now. "We're monitoring the stock markets, they are functioning very well and we continue to believe in the long-term impact of the stock markets", Mnuchin said.

That left it not far from last week's low of $1.2335, a break of which could usher in a further correction after its rally to a three-year high of $1.2538 by late last month.

As a result, he thinks that it's entirely possible that this has led to some "complacency", with investors perhaps "getting a little ahead of themselves".

Monday's slump in Us stocks was a break from many months of relative steady gains and left market participants grappling with an implosion of products that bet against volatility.

The dollar index last rose 0.13 percent, with the euro up 0.06 percent to $1.2384. Overall, the Dow, which finished 2.3% higher at 24,912.77, swung 1,167 points from its low to its high.

The downturn may have been accelerated by the widespread use of exotic, leveraged securities that lose value when market volatility spikes, as it has in recent days.

Bulls argue that strong United States corporate earnings, including a boost from the Trump administration's tax cuts, will ultimately support market valuations.

Tuesday brought more sharp swings, with the Dow falling as much as 567 points shortly after the opening bell then later jumping as much as 367 points.

The steep declines in Europe and Asia on Tuesday followed a heart-stopping Monday that saw the Dow at one point plunge 1,600 points.

Though a dip had been expected for a while, USA losses seemed to spook global markets.

-The S&P 500 index gained 1.7 percent as of 4 p.m.

Even before an impressive late-session surge, Wall Street's stronger performance helped the main European stock markets off their worst levels.

After an initial two-per cent drop, major Wall Street indexes recovered but couldn't sustain the rebound, shedding those gains in afternoon trading.

"Many view the [recent] downturn as a necessity to the runaway equity markets and see it as an opportunity for investors to reinvest at more manageable levels", CMC Markets analyst Oriano Lizza said. The Nasdaq climbed 148, or 2.1 percent, to 7,115.

The pan-European FTSEurofirst 300 index lost 2.50 percent and MSCI's gauge of stocks across the globe shed 0.54 percent. These were reinforced by Friday's January US jobs report that prompted worries the Federal Reserve will raise benchmark interest rates at a faster pace than expected this year.

Though many stock indexes are close to where they started the year, the losses mark a reversal of fortune following a sustained period of gains, a pullback that some market pros have been predicting for some time. The Dow Jones industrial average plunged more than 1,100 points Monday.

Japan's Nikkei stock index closed down almost 4.7 percent Tuesday, recovering from a 7 percent plunge earlier in the day.

-The MSCI Emerging Market index sank 2.5 percent to the lowest in nearly five weeks.

The U.S. dollar was barely up against a basket of currencies, paring gains as Wall Street rallied late.

Dow closes up 567 points after a rocky day