Dow Down Over 1,000 Points Over Two-Day Span

Dow Down Over 1,000 Points Over Two-Day Span

Dow Down Over 1,000 Points Over Two-Day Span

Many investors now believe that the Federal Reserve's campaign to "normalize" monetary policy, reversing years of extraordinary support that included the quantitative easing bond buying program and keeping its overnight target very low, will push interest rates higher than previously thought.

The Dow Jones Industrial Average closed at 25,598.74 on Wednesday with a loss of -831.83 points or -3.15%.

Apple and Amazon, the two most valuable companies in the S&P 500, each had their worst day in 2½ years.

Technology and internet-based companies are known for their high profit margins, and many have reported explosive growth in recent years, with corresponding gains in their stock prices. In the S&P 500, the technology sector led losses with a decrease of -4.50%. Technology companies were among the losers, with the Nasdaq Composite dropping more than 2% to 7,575.34. Companies that sell non-essentials to consumers dropped 1.7 percent.

USA market indexes continued their risk-off selling with all of the major indexes closing with losses.

Paint and coatings maker PPG gave a weak third-quarter forecast Monday, while earlier, Pepsi and Conagra's quarterly reports reflected increased expenses.

The small-cap Russell 2000 index, which is less sensitive than its larger peers to global worries such as trade and yields, was down 1.18 percent.

When investors expect rates to rise, the prices of bonds paying lower interest rates falls.

But Asian bourses were hit hardest on Thursday afternoon - Hong Kong (-3.5pc), Tokyo (-3.9pc), Seoul (-4.4pc) and Shanghai (-5.2pc). Earnings season should improve investors' moods through the end of the year, he writes, with a cycle peak in 2020 and the next major low not due until 2020.

Amazon has soared 50 percent this year, but its stock has fallen 14 percent from its all-time high in early September.

S&P 500 futures and the tech-centric NASDAQ 100 were also down by about 1 percent in before-market trading Thursday morning. USA gold futures settled up $1.9, or 0.16 percent, at $1,193.4.

Traders work on the floor at the closing bell of the Dow Industrial Average at the New York Stock Exchange on Wednesday.

The drop led a wider drop in USA markets.

But Hogan said earnings were also a source of worry because they could showcase the consequences of Trump's trade wars for U.S. companies, from raising costs of raw materials to forcing enterprises to change supply chains. Heating oil fell 1.2 per cent to $2.39 a gallon. "Even the economic impact felt locally will give way to faster economic growth in future months as insurance proceeds arrive and clean-up and rebuilding activity gets underway".

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