July 31, 2014
Wall St falls as emerging-market concerns rise
US stocks dropped following a selloff in emerging market assets, growth concerns in China and expectations that the Federal Reserve will further cut stimulus.
Today's slide put the S&P 500 on track for its worst drop since November 2012, pushing the index down 2.1 percent for the week. The benchmark index fell below its 50-day moving average for the first time since Dec. 18, a technical support level that could indicate more selling pressure if convincingly pierced.
Shares extended losses in afternoon trading, with the S&P 500 below 1,800.
Among the 10 major S&P 500 sectors, industrials fared the worst, down 2.6 percent, as General Electric Co lost 2.7 percent to $25.13 and Boeing Co fell 2.8 percent to $137.37.
The Dow Jones industrial average fell 244.63 points or 1.51 percent, to 15,952.72, the S&P 500 lost 29.29 points or 1.6 percent, to 1,799.17 and the Nasdaq Composite dropped 74.639 points or 1.77 percent, to 4,144.236.
A rout in emerging market assets spread to developed countries in Europe on worries about slowing growth in China, political problems in Turkey, Argentina and Ukraine, as well as about Fed policy.
Worries over China's growth surfaced after a disappointing manufacturing number spurred the S&P 500 to a 0.9 percent drop on Thursday.
The Turkish lira hit a record low and the South African rand fell to five-year low against the dollar.
US-listed shares of Banco Bilbao Vizcaya Argentaria, S.A. tumbled 5.3 percent to $12.01.
Shares of the Spanish bank with heavy exposure to Latin America fell a day after Argentina's peso currency marked its steepest daily decline in 12 years, prompting Argentina's government to loosen strict foreign-exchange controls.
Argentina's government said it would relax stringent foreign-exchange controls, after it abandoned its long-standing policy of intervening to support the peso currency. That resulted in the currency's steepest plunge since the 2002 financial crisis.
Going against the day's downdraft was Procter & Gamble Co , which advanced 2.5 percent to $80.19 and led the Dow's gainers. The world's largest household products maker reported lower quarterly profit, but kept its 2014 sales forecast unchanged.
European shares suffered their biggest fall in seven months. The FTSEurofirst 300 index of top European shares closed down 2.4 percent at 1,301.34 points. The index has now erased all its gains for 2014, and is down 1.1 percent on the year.
A flight to safety lifted currencies backed by a current account surplus, such as the Japanese yen and Swiss franc, and highly rated government bonds. German Bund futures rose and 10-year US Treasury yields hit an eight-week low below 2.75 percent.
Gold traded close to its highest level in nine weeks and was poised for a fifth straight weekly climb as weaker equities burnished its safe-haven appeal. Spot gold rose to $1265.10, up from $1263.95.