Investors flee stocks on global worries, Treasuries rise
By Sinéad Carew NEW YORK (Reuters) - Wall Street stock indexes tumbled on Wednesday as spooked investors ran for safety on global economic and political worries while U.S. Treasuries prices climbed and the U.S
By Sinéad Carew
NEW YORK (Reuters) - Wall Street stock indexes tumbled on Wednesday as spooked investors ran for safety on global economic and political worries while U.S. Treasuries prices climbed and the U.S. dollar surged.
The S&P 500 and the Dow Jones Industrial Average erased their gains for the year while Nasdaq confirmed a correction and the CBOE volatility index <.VIX> registered its highest close since February. [.N]
Investors have been unnerved by a myriad of issues including some disappointing earnings reports, uncertainty over Brexit, Italy's budget spat with the European Commission, upcoming U.S. midterm congressional elections and pressure on Saudi Arabia over the killing of a prominent journalist.
"It looks like more panic and fear as the selling has continued to roll," said Chris Zaccarelli, Chief Investment Officer at Independent Advisor Alliance in Charlotte, North Carolina.
The U.S. dollar rose sharply against the euro to its strongest since August after PMI data showed business growth in the euro zone decelerated faster than expected due to waning orders.
U.S. Treasury debt prices rose as investors were wary of volatile equities, and benchmark 10-year Treasury note yields fell to three-week lows.
"It's a big, global risk-off trade," said Paul Zemsky, chief investment officer at Voya Investment Management in New York. "We've had some headwinds - higher interest rates affecting housing, tariffs causing input costs to manufacturers to go up, which makes earnings look not as stellar ... but that doesn't mean the whole economy is rolling over."
The Dow Jones Industrial Average <.DJI> fell 608.01 points, or 2.41 percent, to 24,583.42, the S&P 500 <.SPX> lost 84.59 points, or 3.09 percent, to 2,656.1 and the Nasdaq Composite <.IXIC> dropped 329.14 points, or 4.43 percent, to 7,108.40.
U.S. data showed a decline in sales of new single-family homes to a near two-year low in September and numbers for the prior three months were revised lower.
Also straining investor sentiment was the Federal Reserve's Beige Book report on economic conditions which pointed to U.S. factories raising prices because of tariffs while inflation appeared modest or moderate in most parts of the country.
MSCI's gauge of stock markets across the globe <.MIWD00000PUS> shed 2.07 percent. On Tuesday, the index had closed more than 11 percent below its January record close.
Benchmark 10-year U.S. Treasury notes
Oil prices fell in late trade after settling higher on a much bigger-than-expected drawdown in U.S. gasoline and diesel inventories which augured a seasonal increase in refining demand. However, traders were concerned about worldwide demand. [O/R]
Saudi Arabia, a major oil producer, is in the midst of a diplomatic storm over the death of dissident journalist Jamal Khashoggi during a visit to the Saudi consulate in Istanbul.
In currencies, the dollar index <.DXY> rose 0.44 percent, with the euro
The Japanese yen strengthened 0.24 percent versus the greenback at 112.18 per dollar
British Prime Minister Theresa May received a show of support from her Conservative Party on Wednesday at a meeting in parliament, shifting focus away from talk of an imminent leadership challenge over her Brexit strategy..
U.S. gold futures
The pan-European STOXX 600 index <.STOXX> fell 0.21 percent, failing to maintain gains from earlier in the session.
(Additional reporting by Sujata Rao in London and Caroline Valetkevitch in New York; graphic by Marc Jones; Editing by Chizu Nomiyama and James Dalgleish)
This story has not been edited by Firstpost staff and is generated by auto-feed.
By Robin Emmott and John Irish | BRUSSELS/PARIS BRUSSELS/PARIS France and Germany will agree to a U.S. plan for NATO to take a bigger role in the fight against Islamic militants at a meeting with President Donald Trump on Thursday, but insist the move is purely symbolic, four senior European diplomats said.The decision to allow the North Atlantic Treaty Organization to join the coalition against Islamic State in Syria and Iraq follows weeks of pressure on the two allies, who are wary of NATO confronting Russia in Syria and of alienating Arab countries who see NATO as pushing a pro-Western agenda."NATO as an institution will join the coalition," said one senior diplomat involved in the discussions. "The question is whether this just a symbolic gesture to the United States
BEIJING Chinese President Xi Jinping on Wednesday called for greater efforts to make the country's navy a world class one, strong in operations on, below and above the surface, as it steps up its ability to project power far from its shores.China's navy has taken an increasingly prominent role in recent months, with a rising star admiral taking command, its first aircraft carrier sailing around self-ruled Taiwan and a new aircraft carrier launched last month.With President Donald Trump promising a US shipbuilding spree and unnerving Beijing with his unpredictable approach on hot button issues including Taiwan and the South and East China Seas, China is pushing to narrow the gap with the U.S. Navy.Inspecting navy headquarters, Xi said the navy should "aim for the top ranks in the world", the Defence Ministry said in a statement about his visit."Building a strong and modern navy is an important mark of a top ranking global military," the ministry paraphrased Xi as saying.