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Global equities were under pressure on Thursday as US stock index futures signaled continued sales after falling by more than 800 points for Dow industrialists a day earlier.
The broad-based market turmoil in Asia came after investors were frightened by rising bond yields and the prospect of rising US interest rates.
How are the main landmarks?
Dow Jones Industrial Average – Futures Contracts
YMZ8, -0.44%
down 122 points, or 0.5%, from 1 to 25,403, while futures on the S & P 500
ESZ8, -0.32%
fell 9.7 points, or 0.3%, to 2,771.40. Future Nasdaq-100
NQZ8, -0.22%
decreased 19.25 points, or 0.3%, to 7,012.75.
See: Why the stock market fell Wednesday, marking the worst start of the quarter for about two years
In a shocking day for investors on Wednesday, the Dow Jones Industrial Average
DJIA, -3.15%
slipped 831.83 points, or 3.2%, to 25,598.74, its worst single day drop since February. The S & P 500 index
SPX, -3.29%
lost 94.66 points, or 3.3%, to 2,785.68 for a five consecutive session slip and the longest losing streak since November 2016. The technology sector fell 4.8%, the largest percentage since August 2011.
Read also: Dow Jones Industrial Average, S & P 500 and Nasdaq stocks dropped the most
The Nasdaq composite index
COMP -4.08%
fell 315.97 points, or 4.1%, to 7,422.05, its largest decline in 2018.
How are global markets traded?
European equities started the day with heavy losses. The pan-European Stoxx 600 index
SXXP, -1.35%
decreased 1.3% to 362.10. The United Kingdom FTSE 100
UKX, -1.29%
1.2%, while the French CAC 40 index
PX1, -1.21%
1.1% and the German DAX
DAX, -0.95%
lost 0.9%.
Asian markets take over on Wall Street, Japan's Nikkei
NIK -3.89%
tumble by nearly 4% and the Shanghai Composite Index
SHCOMP, -5.22%
more than 5%. Taiwanese stocks have even worse
Y9999, -6.31%
down 5.7%, placing it at its lowest level since May 2017.
Lily: Nikkei falls by around 4% as Asian markets follow Wall Street plunge
Other assets include West Texas Intermediate crude oil prices
CLX8, -0.94%
fell 0.9% to 72.4 a barrel, while gold
GCZ8, + 0.54%
was up 0.5% to $ 1,199.80 an ounce. Investors were also monitoring energy infrastructure risks as Hurricane Michael struck Florida's Panhandle.
The ICE index in US dollars
DXY, -0.09%
decreased by 0.2%, with the Japanese yen
USDJPY, + 0.07%
enhancement. The yen is often perceived as a refuge in times of financial and economic uncertainty. L & # 39; euro
EURUSD + 0.2344%
and the pound sterling
GBPUSD, + 0.0758%
were also stronger against the dollar, following the strength of these two rival currencies on Wednesday.
What motivates the market?
Analysts have partially blamed the rise in long-term Treasury yields. 10-year Treasury Bill yield
TMUBMUSD10Y, + 0.21%
peaked over seven years above 3.26% on Tuesday morning. Yields and debt prices are moving in opposite directions.
Rising yields raise borrowing costs for businesses and investors and encourage investors to look again at stock valuations, which some believe is too high. Equities also lose their attractiveness to higher rates of risk-free bonds. However, higher yields are also seen as a reflection of a strong economy, supported by a number of strong economic data.
Purchases related to Haven appeared to begin when stocks fell, resulting in lower yields. The 10-year rate was down 5 basis points early Thursday to 3.17%.
US President Donald Trump, who has consistently criticized the Federal Reserve for the three interest rate hikes she has made this year, doubled her opinion in a phone interview Wednesday at Fox News, saying the Fed " unleashed". was after he made similar comments at the rally in Erie, Pennsylvania.
Treasury Secretary Steven Mnuchin said it was not surprising that equities are "somewhat corrected," but that economic fundamentals remain "extremely strong," Bloomberg News said at a Fund meeting. International Monetary Fund and the World Bank in Bali.
Investors are also preparing for the start of the third quarter earnings season, which begins unofficially Friday with the results of major financial institutions.
What did the analysts say?
"Investors are earning profits and liquidating positions while taking the time to ask where to go from now on. The timing of the sale, just a few days before the US earnings season, will begin Friday unofficially, is more than a coincidence, "said Jasper Lawler, head of research at the London Capital Group.
"While the profits from the eruption are again expected, fears are growing as to the forecasts of prospective consulting firms. The headwinds of the market, such as higher interest rates, energy prices, the strength of the dollar and prices, are confusing investors and create a cautious picture for the future, "he said. declared.
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