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Stocks fell sharply on Thursday as continuing fears over U.S.-China trade relations and concern over a possible global economic slowdown kept investors on edge.
The Dow Jones Industrial Average capsized 605.09 points, or 2.4%, to reach lunch hour at 24,421.98, bringing its two-day losses to more than 1,300. It also fell back into negative country for 2018.
The S&P 500 dropped 57.01 points, or 2.1%, to 2,643.05, led by a decline in bank shares like J.P. Morgan Chase. The S&P 500 fell back into correction territory, down 10 percent from its 52-week high.
The NASDAQ lost 96.34 points, or 1.4%, to 7,062.07
Shares of major banks like J.P. Morgan Chase, Citigroup and Bank of America all traded lower on Thursday.
Facebook shares fell 1.5% after Stifel downgraded them to hold from buy.
Apple’s stock dropped 3.2% after UBS said in a note it sees the weakest "purchase intent" for the iPhone in five years. The bank cut its 12-month price target on Apple to $210 from $225.
Trade fears ratcheted up after news broke Wednesday that Huawei CFO Meng Wanzhou was arrested by Canadian authorities in Vancouver, where she faces extradition to the U.S. The arrest — which took place Dec. 1 — decreases the likelihood that a permanent U.S.-China trade deal will be reached. Huawei is one of the largest mobile phone makers in the world.
Meng’s arrest comes after President Donald Trump and Chinese President Xi Jinping agreed to hold off on implementing additional tariffs on each other’s goods. The world’s largest economies have been engaged in a trade spat that has sent ripples through global markets. The skirmish has investors worried that corporate earnings and economic growth could be negatively impacted.
On Wednesday, U.S. equity, option and fixed income markets were closed in honour of former President George H.W. Bush.
Prices for the benchmark for the 10-year U.S. Treasury were sharply higher, lowering yields to 2.86% from Tuesday’s 2.91%. Treasury prices and yields move in opposite directions.
Oil prices suffered $2.07 to $50.82 U.S. a barrel.
Gold prices $4.60 to $1,247.20 U.S. an ounce.
