Stocks Tumble in Biggest Weekly Decline Since 2016: Markets Wrap

  • Dow Jones Industrials lost more than 1, 400 points in the week
  • Crude oil registers largest five-day increase since July

U. S. stocks tumbled, sending the S& P 500 Index to its biggest weekly loss in more than two years, on concern that a trade war and higher borrowing rates could throttle global growth. Oil surged on speculation sanctions on Iran will be re-imposed.

The Dow Jones Industrial Average slumped to the lowest since November, led by losses Friday in companies as diverse as 3M Co. to Goldman Sachs Group Inc. The S& P 500 dropped to its least since the volatility-fueled meltdown in early February. Gold rallied and Treasury yields declined as investors sought safe havens.

Global markets were caught in a risk-off mode after China announced retaliation against President Donald Trump’ s proposed tariffs announced Thursday. China’ s ambassador to the U. S. wouldn’ t rule out the possibility of the Asian nation scaling back purchases of Treasuries in response to the tariffs.

It’ s been a miserable week for higher-risk markets globally, as a trade war edged closer, the tech sector was roiled by Facebook Inc. ’ s privacy scandal and data showed European growth sputtering. The tech heavy Nasdaq 100 dropped 7. 3 percent this week, the most since 2015. Traders had already been bracing for the possibility of slowing expansion as the Federal Reserve reiterated its commitment to further interest-rate increases after Wednesday’ s hike.

“ There is a tug of war between Fed tightening, fiscal stimulus, strong earning but slowing sales and now tariffs and potential trade wars, ” said Jason Browne, chief investment strategist at FundX Investment Group.

Adding to the image of the ascendance of the “ America first” faction, Trump replaced White House National Security Adviser H. R. McMaster with John Bolton, a controversial foreign-affairs specialist whom the U. S. Senate declined to confirm as President George W. Bush’ s ambassador to the United Nations.

Terminal users can follow live coverage of the market moves on Bloomberg’ s TOPLive blog. And these are the main moves in markets:

Stocks

  • The S& P 500 Index dropped 2. 1 percent to 2, 588. 24 as of 4: 02 p. m. New York time, while the Dow Jones Industrial Average slumped 1. 8 percent to 23, 532. 30 and the Nasdaq Composite Index dropped 2. 4 percent to 6, 992. 67. On the week, the S& P 500 tumbled 5. 9 percent, the Dow dropped 5. 7 % and the Nasdaq slumped 6. 5 percent.
  • The Stoxx Europe 600 Index fell 0. 9 percent and the MSCI Asia Pacific Index tumbled 2 . 6 percent.
  • The  U. K. ’ s FTSE  100 Index slipped 0. 4 percent, after touching the cheapest in more than 15 months.
  • The MSCI Emerging Market Index fell 2 percent.

Currencies

  • The Bloomberg Dollar Spot Index fell 0. 3 %.
  • The euro rose 0. 5 percent to $1. 2362, the strongest in greater than a week.
  • The British pound increased 0. 3 percent to $1. 4137.
  • The Japanese yen advanced 0. 5 percent to 104. 78 per dollar, the strongest in more than 16 months.

Bonds

  • The yield on 10-year  Treasuries fell one basis point to 2. 82 percent.
  • Germany’ s 10-year yield was little changed at 0. 53 percent.
  • Britain’ s 10-year yield gained one basis points to 1. 44 percent.

Commodities

  • West Texas Intermediate  crude increased 2. 5 percent to $65. 89 a barrel.
  • Gold increased 1. 4 percent to $1, 348. 21 an ounce, the highest in more than a month.