S&P drops to eight-month low on global growth worries
The S&P 500 fell to an eight-month low on Monday as Apple Inc, as well as financial and healthcare sectors led losses on mounting worries over global growth, the U.S.-China trade war and uncertainty over Britain`s exit from the European Union.
The S&P and the Dow Industrials, already in the red for the year after shedding more than 4.5 percent last week, fell over 1 percent. The Nasdaq reversed after an earlier bounce to drop about 0.5 percent.
Markets have been dogged by signs of cooling global growth, concerns over interest rates and worries that escalating tensions between the United States and China could scuttle a fragile trade truce.
"You have political tensions with China, the potential for slowing global growth, and other geopolitical tensions, that continue to weigh on the markets," said Charlie Ripley, senior investment strategist for Allianz Investment Management.
All the 11 major S&P sectors were lower. The biggest drag on the market was a 2.5 percent drop in financials as the U.S. Treasury yields dropped further on worries over U.S.-China trade conflict and the Brexit turmoil. [US/]
British Prime Minister Theresa May said she was delaying a planned vote in parliament on her Brexit deal as it was set to be rejected "by a significant margin".
The rate-sensitive bank stocks tumbled 3.22 percent on worries that Brexit could hamper global growth, giving the Federal Reserve more reason to slow its pace of interest rate hikes.
"If the Fed is slowing, that means economic activity is below normal and that can negatively impact earnings," said Paul Nolte, portfolio manager at Kingsview Asset Management in Chicago.
JPMorgan Chase & Co, Wells Fargo & Co, Citigroup Inc and Bank of America Corp fell over 3 percent.
At 11:50 a.m. ET, the Dow Jones Industrial Average was down 356.82 points, or 1.46 percent, at 24,032.13. The S&P 500 was down 30.14 points, or 1.14 percent, at 2,602.94, and the Nasdaq Composite was down 29.50 points, or 0.42 percent, at 6,939.75.
Energy stocks retreated 3.1 percent, as oil prices fell. Global pharmaceutical stocks weighed the most on the health index, which fell 1.3 percent and led losses among the seven sectors that were down over 1 percent.
Apple dropped 2.1 percent after Qualcomm Inc said it had won a preliminary order from a Chinese court banning the import and sale of several iPhone models in China due to patent violations.
Despite that, the technology index was down only 0.3 percent, the least among the 11 sectors.
Declining issues outnumbered advancers for a 3.68-to-1 ratio on the NYSE and a 2.15-to-1 ratio on the Nasdaq.
The S&P index recorded no new 52-week highs and 90 new lows, while the Nasdaq recorded three new highs and 303 new lows.
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)
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