The Dow Jones industrial average plunged more than 1,100 points Monday as stocks took their worst loss in six and a half years. Two days of steep losses have erased the market's gains from the start of this year and ended a period of record-setting calm for stocks. (Feb. 5) AP
U.S. stock futures gyrated wildly early Tuesday in the wake of a market sell-off on Wall Street that saw the Dow Jones Industrial Average benchmark stock index record its largest ever single-day point loss.
Monday's market plunge effectively brought to a halt a long-running stock rally that kicked into high gear after the election of President Trump in November 2016.
Ahead of the market open in New York, Dow futures moved in and out of positive territory, while Monday's market rout weighed on Asian and European bourses. The Dow was recently down 260 points. Earlier, it fell several hundred points more.
Tokyo's benchmark ended 4.7% lower at 21,610.24. The Shanghai Composite index fell 3.4% to 3,370.65. In Britain, the FTSE 100 index skidded 1.9% in intraday trading. European benchmark indexes from Paris to Frankfurt declined by similar amounts.
On Monday, the Dow declined 1,175 points, or 4.6%, to 24,346, while the S&P 500 fell 4.1% and the Nasdaq Composite 3.8%. The Dow's dive, its biggest one-day point loss since August 2011, came as investors fretted over inflation creeping higher and the prospect of rising interest rates. Both of these things stoked fears that economic expansion and a prolonged share price rally could be derailed earlier than anticipated.
"The party may be over for now but this could be more of a sobering correction than a rout," said Jacob Deppe, head of trading at online trading platform Infinox, in emailed comments. "There have been plenty of warnings over the past few weeks that equities were overvalued and that U.S. stock markets in particular were overheating."