Dow tumbles more than 300 in worst day in months
NEW YORK (AP) – U.S. stocks had their worst one-day drop since February as traders worried about weak corporate earnings and the looming end of economic stimulus from the Federal Reserve.
The drop interrupted a prolonged advance in the market and erased its gains for July. It was only the second monthly loss for stocks this year, after January.
The Dow Jones industrial average plunged 317 points, or 1.9 percent, to close at 16,563 Thursday.
The Standard & Poor’s 500 index dropped 39 points, or 2 percent, to 1,930. The Nasdaq composite dropped 93 points, or 2.1 percent, to 4,369.
The S&P 500 closed at a record high just one week ago.
Whole Foods Market, Yum Brands and Exxon Mobil were among companies that fell after reporting results or forecasts that disappointed investors.
Major indexes started lower and the losses accelerated as the day went on. The slide interrupted a prolonged advance in the market and put it on course for its first monthly loss since January. The Standard & Poor’s 500 index reached its latest record high just one week ago. It’s currently 2.7 percent below that level.
Investors responded to several weak earnings reports, escalating geopolitical instability and widespread views that stocks had become too expensive. They are also contemplating the likely end of the Federal Reserve’s stimulus program this year.
Argentina’s stock market slumped 6.8 percent to 8,327. The collapse of talks with U.S. creditors Wednesday sent Argentina into its second debt default in 13 years and raised questions about what comes next for the South American nation’s staggering economy.
The S&P 500 index closed at a record earlier in the month, extending a five-year bull run. The S&P 500 hasn’t had a sell off severe enough to qualify as a correction, Wall Street parlance for a fall of 10 percent or more from a peak, since October 2011.
The gains have also come despite rising political tensions between Russia and the West and an escalating war between Israel and the Palestinian Group Hamas. Argentina’s default can now be added to the list of worrying developments.
“It’s an accumulation of all these little things,” said Jerry Braakman, chief investment officer at First American Trust. “People feel that we due for, not a major correction, but some sell-off in the three to 10 percent range.”
U.S. stocks had their worst one-day drop since February as traders worried about weak corporate earnings and the looming end of economic stimulus from the Federal Reserve.
The drop interrupted a prolonged advance in the market and erased its gains for July. It was only the second monthly loss for stocks this year, after January.
