US stocks extend losses

The US Central Bank’s eagerness to raise rates continues to drive major stock market sell-off

US STOCKS

On Wednesday, the Dow Jones fell by 832 points, plunging the index below 26,000 representing a 3% decline – the third worst point decline in its history. The S&P 500 fell by 3.3%, while the Nasdaq slid by more than 4%, its biggest one-day loss for two years. All 30 companies that comprise the Dow were down at market close.

Today, US equity markets have opened slightly lower. The S&P 500 opened at 2785.68, down 3.29%, while the Dow slid marginally at market open, hovering around 25466.

The October decline that US stocks have endured is fuelled by investors fearing further interest rate hikes. The US Central Bank has raised rates three times this year already, with many expecting the Fed to increase rates once more before the end of the year.

The market sell-off being witnessed in the US is spreading to Europe, with the FTSE 100 is trading in correction territory, 10% below its recent high, extending losses to an 8-month low.

Home builders in the UK were among the hardest hit with Barratt Developments BDEV falling 8% and Taylor Wimpey TLW sliding 3.2%.

Elsewhere, the Nikkei was down 3.4% at market close, while the Shanghai Composite lost the gains it had made in late-September, down 5.2% at close – representing the sharpest fall the index has seen since February 2016.

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