European Markets Tumble Amidst Global Sell Off Concerns

One month after, for instance, the Dow was up 1.38%, on average – more than twice its average anytime one-month return of 0.63%, looking at the last 100 years’ worth of data.

The bad start Monday extended the 666-point drop that happened Friday, a drop of about 2.5 percent.

Pricier valuations are one factor behind the sell-off; another driver is the move by the US Federal Reserve to tighten monetary policy by raising interest rates in the face of rising wages and fears of an uplift in inflation.

At 10.12am EST (3.12pm GMT), the Dow Jones Industrial Average had gained 0.43 percent on its previous close from yesterday to 24,449.65 points.

To be sure, Dow futures pointed to a third straight day of losses on Tuesday, deepening a correction to the stock market’s long-running rally that saw the biggest intraday fall in history for the Dow Jones Industrial Average on Monday.

When you look at this on a pure percentage basis, the Dow was briefly down more than 6 percent.

He added: “The fall in the S&P 500 was startling, but it merely returned the index to its early December level – it has given up the gains only of the past nine weeks”.

Wall Street continued its wild ride Tuesday morning as the Dow Jones opened down 522.94 points, or 2.15 percent. By mid-afternoon in NY, the S&P 500 was off 1.5 per cent at 2,721.30.

A tough day on Wall Street as the nation watched stocks plummet Monday afternoon.

Banks fared the worst as bond yields and interest rates nosedived.

So while the market plunge might rattle investors and ding consumer confidence, it is not a sign that the economy is in trouble.

On Friday, it was revealed that there were higher U.S. jobs as compared to the expectations of analysts.

That has fed into widespread concerns that markets were stretched following a strong run over the past year that pushed many indexes to record highs.

The technology-heavy Nasdaq market has fallen in six of the last eight trading sessions.

The market declines, which spread globally, underscored the challenges he and other bankers face – to make decisions that sustain the growth of the economy without alarming investors. Hong Kong’s Hang Seng Index fell 5.1 percent.

In commodities, USA crude fell 2.38 percent to $63.89 per barrel and Brent was last at $67.49, down 1.59 percent on the day. All three were lower earlier. The Russell 2000 index of smaller-company stocks sank 56.18 points, or 3.6 percent, for 1,491.09.

Stephen Schwarzman, the chairman and CEO of financial firm Blackstone, warned recently of a potential “reckoning” in markets.

Asian stocks plunged on February 6 after the record-breaking loss on Wall Street, extending a global rout as panicked investors fret over rising US borrowing costs and take profits after months of market euphoria. “When the market starts dropping, then they have margin calls and they have to sell and that causes more downward movement in the market”.

The sell-off has ended the longest winning streak for USA markets in history, as it is more than 400 days since the last 5 per cent correction. Silver dipped 4 cents to $16.67 an ounce.