Stocks plunge to historic losses after midday rebound loses steam
- In one of the most volatile sessions in years, stocks opened to huge losses, recovered most of those losses and then retreated again to close with the biggest losses in four years.
- The Dow dropped as much as 1,089 points in the first few minutes this morning before rebounding as traders said mutual funds and other investors began stepping in to buy stocks, but ended the tumultuous session down nearly 600 points, or 3.6%; the blue-chip index ended with its biggest three-day point loss in history at 1,477 points.
- "Markets remain very, very vulnerable to bad news [out of] emerging markets," says Dan Veru, chief investment officer at Palisade Capital Management, who attributes some of the sharp swings to ETFs since "it's so easy to move a bajillion dollars in a nanosecond."
- Today's selling was far-reaching with just 136 NYSE listings ending positive while 3,079 names posted losses; all 10 S&P sectors finished in the red, with losses ranging from 3.1% (telecom services) to 5.2% (energy).
- The energy sector widened its Q3 decline to 20.5%, as crude oil tumbled 5.5% to fresh six-and-a-half years lows at $38.24/bbl.
- Investor participation surged, with more than 1.6B shares changing hands at the NYSE floor.
- U.S. Treasury yields fell for the fourth straight day, with the 10-year yield dropping to an intraday low of 1.976% and closing 5.6 bps lower at 1.997%, its lowest point since April 28; the benchmark yield has plunged more than 50 bps since June 10, when it reached its highest point this year at 2.478%.
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