Markets slide again, complete worst two-week start to year

Stock traders follow stock prices at the New York Stock Exchange, Friday, Jan. 15, 2016.

“Most Asian and European equity market indices are having a rough final trading session today, capping off a volatile week”, Stephen Guilfoyle, managing director of floor operations at the New York Stock Exchange, said in an email.

The broad-based S&P 500 fell 57.42 (2.99%) to 1,864, while the tech-rich Nasdaq Composite Index plummeted 174.93 (3.79%) to 4,440. USA energy companies have suffered as the Middle East continues to flood the world with cheap oil, raising questions about their ability to repay their debt. The Dow and S&P 500 have now fallen about 8 percent this year, while the Nasdaq is off 10.7 percent.

Dow components Exxon and Chevron were down 3-4.5 per cent, while Caterpillar dropped almost 4.5 per cent.

The Dow slumped 392 points or 2.39 percent while the S&P 500 lost 42 points or 2.18 percent. And industrial production includes output from mining, which includes oil and natural gas drilling, and that figure was down for the fourth straight month.

USA retail sales fell unexpectedly in December, and the producer price index, a measure of price fluctuations from providers of goods and services, ticked downward – both hinting that the US economy was weaker in the fourth quarter.

Many investors had welcomed the new year with fairly high hopes. Oil prices have lost around 20% this year amid concerns that the onset of Iranian exports after sanctions are lifted could add to the glut of supply, as fears around Chinese demand have also added to the pressure on oil and base-metals prices. After a market correction in August, few forecast it would happen again so soon.

The widespread market losses over the start of 2016 has sparked talk of the potential for a global recession, which the market “certainly sees as a possibility”, Levy said.

The turmoil on Wall Street came after markets in Asia and Europe tumbled.

The U.S. sell-off also was fueled by disappointing economic data.

In another party, USA crude-oil slumped blew the $30 per barrel Friday.

But the biggest drop was in Intel (INTC.O), tumbling 5.5 percent to $30.95 as concerns about the chipmaker’s slowing data center revenue growth overshadowed a quarterly profit beat.

While the oil plunge is great for many consumers because it lowers the price of gas at the pump, it’s been a big negative for stocks lately.

“The spillover from China has been concentrated in crude oil and there are reports that commodity hedge funds have experienced a sharp increase in margin calls as the price of oil falls”, said Gail Dudack, chief investment strategist at Dudack Research Group in NY in a Friday note to clients.

Oil prices dropped to its lowest point since 2003 on Friday.

Investors fled stocks and rushed into assets perceived as safe, sending the 10-year Treasury yield briefly below 2% and gold sharply higher.

The Nasdaq is down 155.22 points, or 3.3 per cent.

VEGAS, BABY: Wynn Resorts jumped 9.1 percent after the casino operator said it expects to report a larger operating profit from its Las Vegas business.