Stocks take another tumble, Dow dives more than 1000 points

Stocks take another tumble, Dow dives more than 1000 points

The Dow fell 528 points on Thursday.

The Dow plunged more than 1,100 points on Monday, in its biggest daily point decline ever, as a stronger-than-expected USA jobs report stoked fears that interest rates would be hiked quicker than previously anticipated.

But until the bull market is ready to resume in earnest, investors may need to feel more pain.

This is approximately how much the stock market has lost since Washington passed personal and corporate income tax cuts on December 20.

The S&P 500, the index that investors pay the most attention to, is in a correction, down 10.2 percent from its recent high.

A correction is less severe than a bear market, when stocks decline 20% from their recent highs.

The S&P 500 last confirmed a correction in January 2016, when it fell 13.3 per cent amid concerns about a slump in oil prices. "Big mistake, and we have so much good (great) news about the economy!"

Global markets also fell.

Overnight, world markets followed the United States' lead and dropped.

At that point, said Johnson, stocks would find support and begin their next bullish move back to his year-end target of S&P 2,850.

What does this mean for the Trump rally?

Nvidia's relative strength line, which tracks a stock's performance vs. the S&P 500 index, is near record highs. Earlier the biggest markets in Asian fell between 1% and 2.5%.

The percentage decline on Thursday, 4.2%, wasn't almost as bad as the scary days of the 2008 financial crisis.

At the closing bell, the Dow was down 1,032 points, or 4.15 percent, finishing a tough day at 23,860. The Dow had never lost more than 777 points in a single day.

More recently, Black Monday - known as Black Tuesday in the United Kingdom because of time differences - references the global markets crash on October 19, 1987. EA also plunged 5.3% on Thursday, falling well below its recent breakout point. And on several days during the financial crisis in 2008, the Dow dropped 6% or 7%.

On Monday (Tuesday NZT), the Dow finished down 4.6 per cent while the S&P 500 sank 4.1 per cent, to 2648.94. Falls like this have not been registered since August 2011 when investors were fretting over Europe's debt crisis and the debt ceiling impasse in Washington that prompted a USA credit rating downgrade.

I keep hearing the term "circuit breaker".

Trader Michael Milano, right, works on the floor of the New York Stock Exchange, Thursday, Feb. 8, 2018. Trading volumes were 50 percent above normal. This would be much more severe than what happened Monday. The tech-heavy Nasdaq ended the day 3.9 per cent lower.

After the 15-minute pause, trading resumes.

These first two levels of circuit breaker apply only until 3:25 p.m. Monday's losses came on top of Friday's 666-point drop in the blue-chip index, which resulted in the worst week for the index in two years.

In other commodities trading, wholesale gasoline remained at $1.77 a gallon. If it tries to correct and does not, we could see another 2008 recession.

Stock market declines don't cause recessions, and they do a pretty poor job of predicting whether one is coming. Technology and industrial companies and retailers moved higher, a possible sign of confidence the USA economy will keep growing.

Unemployment is at a 17-year low. But a steady climb that lasted more than a year has given way to two weeks of shaky selling.

As for local economic news, NAB will release its fourth-quarter business confidence report this morning.

Despite these large drops, the stock markets have been rising for about nine years now, and many analysts say it's time to hit the pause button.



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