Worst Week For US Stocks Since 2008

U.S.stocks ended their worst week in a decade with more bruising losses Friday, and with the tech-rich Nasdaq entering a bear market amid worries about trade wars.

The tech-heavy Nasdaq sank to a 15-month low, falling as much as 21.5 percent from its Aug. 29 high. The benchmark S&P 500 index, already on pace for its biggest percentage decline in December since the Great Depression, hit its lowest level since August 2017. The Dow Industrials fell to the lowest level since October 2017.

All three indexes swung between losses and gains of more than 1 percent. They received a momentary boost after New York Fed President John Williams said on CNBC that the Fed is open to reassessing its views and monitoring market signals that economic growth could fall short of expectations.

But those gains soon evaporated as economic worries again prevailed. Williams’ dovish comments could point to hidden concerns among some Fed policymakers, said Tim Ghriskey, investment strategist at Inverness Counsel in New York.

“It has been a remarkably terrible trading week for financial markets amid concerns over rising US interest rates, decelerating global growth, Brexit uncertainty and chaos in Washington,” said Lukman Otunuga, a research analyst at FXTM.

“(Williams’ comments) helped the markets for a while early on, and then it was just a sell-off after that,” Ghriskey said. “Part of that is when the Fed says something like they’re re-looking at things, there’s a concern that maybe the Fed knows something that we don’t know.”

Technology and communication services stocks bore the brunt of the sell-off, falling 2.3 percent and 2.7 percent, respectively.

The FAANG group of momentum stocks fared poorly. Facebook Inc shares tumbled 5.4 percent, Amazon.com Inc shares slid 4.8 percent and Netflix Inc shares sank 5.0 percent. Shares of both Apple Inc and Google parent Alphabet Inc dropped more than 2 percent.

Turmoil in Washington injected further pessimism into U.S. stock markets. President Donald Trump said there was a very good chance a government funding bill, which included funding for a wall along Mexico border, would not pass the Senate.

“The market continues to react to the possibility of a government shutdown, fear of a domestic and global slowdown and general displeasure about the direction of Fed policy,” said Ryan Larson, head of U.S. equity trading at RBC Global Asset Management in Chicago.

more recommended stories