December 15, 2017
Thursday, September 25, 2014

Wall Street ends sharply lower, S&P below key support level

US stocks ended with sharp losses today, with the S&P 500 suffering its biggest one-day decline since July, as Apple tumbled and the dollar rose to a four-year high.

The day's decline was broad, with all ten primary S&P 500 sectors lower on the day and most down more than 1 percent. About 80 percent of stocks traded on both the New York Stock Exchange and Nasdaq ended lower.

The S&P has dropped for four of the past five sessions and it closed below its 50-day moving average for the first time since Aug 15. That level had previously served as support, and a protracted period underneath it could signal further losses ahead.

The losses came on the continued strength of the dollar, which rose 0.2 percent against a basket of major currencies. It is up 6.8 percent for the quarter, its biggest quarterly increase in six years.

With the day's loss, the S&P is about 2.3 percent below a record close hit earlier this month, meaning it remains far from correction territory - defined as a 10 percent drop from a peak. The S&P hasn't had a correction since 2012, with investors using market declines as buying opportunities, a trend that may yet hold here.

The Dow Jones industrial average fell 264.26 points, or 1.5 percent, to 16,945.80, the S&P 500 lost 32.31 points, or 1.6 percent, to 1,965.99 and the Nasdaq Composite dropped 88.47 points, or 1.94 percent, to 4,466.75.

Apple Inc suffered one of its biggest daily declines of the year, breaking under key technical levels after the tech giant withdrew an update to its new operation system, which some users complained contained numerous glitches.

The stock fell 3.8 percent to $97.87 and was the biggest weight on the S&P, comprising 2.6 points of the index's 32.3 point drop. Apple closed under its 50-day moving average for the first time since April 23, and moved on volume of almost 100 million shares, well above its 50-day average of 56.46 million.

Today's losses were so pronounced that no S&P 500 component rose more than 1 percent on the day. The biggest gainer was Motorola Solutions Inc, which added 0.7 percent to $62.24 after it said it would reduce its pension plan liability by $4.2 billion.

Micron Technology Inc fell 3.4 percent to $30.61 after the market closed after reporting its fourth-quarter results. Nike Inc rose 4.1 percent in after-hours trading after its results.

About 6.3 billion shares traded on all US platforms, according to BATS exchange data, above the month-to-date average of about 6.02 billion.

European shares slipped to a one-month low in late trading today, tracking a sell-off in US stocks, as a stronger dollar undercut prices for industrial metals, causing mining shares to drop.

The STOXX Europe 600 Basic Resources index fell 2 percent, making the sector the biggest decliner in Europe, as the prices of key base metals fell sharply following gains by the dollar index, which measures the US currency against a basket of major currencies.

Miners Rio Tinto and BHP Billiton fell 2.4 percent and 2.9 percent respectively. Contributing to the loss was a drop in China's steel futures to a record low. That put more pressure on prices of iron ore, which have lost about 41 percent this year.

The FTSEurofirst 300 index of top European shares ended 0.9 percent lower at 1,373.09 points. It rose to a high of 1,391.80 in early trading before falling up to 1,369.63, the lowest since late August. A weaker open at Wall Street triggered the sell-off in Europe.

Britain's blue-chip FTSE 100 fell 1 percent. It was also affected by comments from Bank of England Governor Mark Carney, who said the bank was getting nearer to raising rates, but the exact date would depend on economic data.

Asian shares got off to a rocky start on Friday after a sharp drop on Wall Street, which curbed enthusiasm for the dollar even after the US unit touched multi-year highs in the previous session.

MSCI's broadest index of Asia-Pacific shares outside Japan was down 0.3 percent in early trade, poised for a weekly loss over 2 percent.

Japan's Nikkei stock average skidded 1.6 percent, on track to shed more than 1 percent for the week, as a stronger yen exacerbated the risk-averse mood.

Data released before the market opened showed Japan's annual core consumer inflation eased in August, in another sign that the Bank of Japan could be forced into additional easing steps to meet its 2 percent price goal sometime next fiscal year.

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Tags:  Stocks  shares  FTSEurofirst  Nikkei  US  Dow Jones  

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