Wall Street slips, turns risk averse on strong dollar, trade worries

U.S. stock indexes slid on Wednesday in a broad decline over concerns of a strengthening dollar, Turkey`s currency crisis and United States` trade relations with its partners.

Seven of the 11 major S&P sectors were lower, with energy and metal and mining companies hit by rising commodity prices. While trade-sensitive companies such as Boeing and Caterpillar fell, the usually trade-agnostic technology stocks also dropped.

The dollar index hovered near a 13-month high, also bumped by strong U.S. retail sales. U.S. crude oil prices slid nearly 4 percent, while metal prices fell on the greenback`s strength, which also hurts the overseas income of U.S. multinationals.

Turkey doubled tariffs on some U.S. imports in retaliation to Washington`s moves, while Beijing lodged a complaint with the World Trade Organization to help determine the legality of U.S. tariff and subsidy policies.

"The real question that comes up is if this is a start of a bear market or is this another correction in normal volatility that we`re experiencing this year," said Jason Browne, chief investment strategist at FundX in San Francisco, California.

"Investors are worried if the markets have gotten ahead of itself and therefore there is a fear-based and broad-based selling, it`s not based on fundamentals."

MSCI`s widely tracked 24-country emerging market stocks index entered a technical bear market, as fresh selling took its drop since late January to 20 percent.

The S&P energy sector tumbled 2.88 percent and the materials sector shed 1.81 percent. The industrial sector fell 0.70 percent, with Caterpillar and Boeing slumping more than 2 percent.

At 12:57 a.m. EDT the Dow Jones Industrial Average was down 209.93 points, or 0.83 percent, at 25,089.99, the S&P 500 was down 24.74 points, or 0.87 percent, at 2,815.22 and the Nasdaq Composite was down 104.89 points, or 1.33 percent, at 7,766.00.

The technology sector fell 1.35 percent.

The high-flying FAANG stocks – Facebook, Apple, Amazon, Netflix and Google-parent Alphabet – fell between 0.3 percent and 3.5 percent.

Macy`s sank 14.4 percent on concerns over the company`s gross margin forecast for the fall season.

The bleak outlook dragged down other retailers. The S&P 500 retailers index slid 1.59 percent despite data showing U.S. retail sales rose more than expected in July.

Nordstrom and JC Penney, both of which report results on Thursday, fell 5.6 percent and 8.7 percent, respectively. Walmart, which also reports on Thursday, dipped 1.2 percent.

Retailers make up the majority of the S&P 500 companies yet to report results. Of the 460 companies that have reported, 79.1 percent have beaten analysts` estimates, according to Thomson Reuters I/B/E/S.

Tesla fell 3.3 percent after Fox Business Network reported the U.S. securities regulator has subpoenaed the company regarding CEO Elon Musk`s plans to take it private and his statement that funding was "secured."

Declining issues outnumbered advancers for a 2.65-to-1 ratio on the NYSE and for a 3.30-to-1 ratio on the Nasdaq.

The S&P index recorded 10 new 52-week highs and 11 new lows, while the Nasdaq recorded 51 new highs and 126 new lows.

(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)