Dow plunges 666 points amid rate-hike fears after strong jobs report

The Dow dropped almost 666 points, or 2.5 percent, just two weeks after it surpassed the 26,000-mark for the first time.

– The S&P 500 index fell 2.1 percent to 2,761.91 at 4 p.m.in NY. The Nasdaq pulled back 5.4 percent the week of February 5.

The Dow Jones industrial average dropped 500 points, or 2 percent, as a weeklong slump in stock market picks up speed.

The S&P 500 and the Dow are both on track for their biggest one-week declines in more than two years.

Weak earnings from several giant USA companies including Exxon Mobil and Alphabet, Google’s parent company, further dented investors’ confidence.

“A big wage growth number is the biggest risk to the stock market rally, because it means the Fed may get more aggressive in raising interest rates”, says Invesco chief global market strategist Kristina Hooper.

The CBOE Volatility Index.VIX, the most widely followed barometer of expected near-term volatility for the S&P 500 Index rose more than four points to 17.86, its highest since November 2016.

European markets are lower at midday, as bank stocks sell off after Frankfurt-based Deutsche Bank posted a larger-than-forecast fourth-quarter loss – and its third straight full-year loss.

Energy companies fell more than the rest of the market Friday after Exxon Mobil and Chevron reported disappointing results.

Among the stocks in the Dow, Apple fell 4.3 percent Friday, Exxon Mobil lost 5.1 percent, Chevron was down almost 6 percent and Goldman Sachs dropped 4.5 percent. Combined estimates for 2018 profits among companies in the index have gone from $145.90 a share on December 15 to $156.20 on Friday, a rate of increase that is four times faster than any stretch since at least 2012, data compiled by Bloomberg show. Futures on Friday decreased 0.8 percent to settle at $1,337.30 an ounce. In Asia, Japan’s benchmark Nikkei 225 fell 0.9 percent and South Korea’s Kospi slid 1.7 percent.

On Wednesday, the Federal Reserve left its benchmark interest rate unchanged at 1.25 to 1.5 percent after its two-day meeting, while giving an upbeat assessment of recent US economic growth. Despite a strong jobs report that showed rising wages and solid unemployment numbers, investors reflected growing concern about inflation levels.

– Germanys DAX index sank 1.7 percent, the most since June. Roughly half the companies in the S&P 500 have given updates on their performance for the last three months of 2017, and 79 percent of them have reported stronger revenue for the quarter than analysts expected, according to S&P Global Market Intelligence. The tech selloff worsened, sending the Nasdaq 100 Index lower by 2.1%.

– The MSCI Asia Pacific index fell 0.7 percent.

President Trump, who repeatedly has touted the stock market’s gains as evidence that his economic policy efforts are paying off, trumpeted the January jobs report on Twitter. The company, though, said it found enough untapped fields to replace 155 percent of the crude and gas it pumped a year ago, the highest reserves replacement since 2011.