Stocks lose momentum a day after Dow's record gain

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On Wednesday, the three prominent Wall Street indices had broken out of their recent slump to post major gains, bolstered by bullish data on holiday consumer spending, strong showings in the energy sector, and White House reassurances that Federal Reserve Chairman Jerome Powell and US Treasury Secretary Steven Mnuchin were not on the chopping block.

After a pause in trading for the holiday, US markets reopen Wednesday.

London sank 0.8 per cent and Paris shed nearly 0.1 per cent compared with Monday's closing levels. Britain's FTSE 100 was flat at 6,685.64.

"Wall Street is running around like a chicken with its head cut off, while Mr. and Mrs". Amazon (AMZN), Facebook (FB), Alphabet (GOOGL), Netflix (NFLX) and Apple (AAPL) all fell between 1% and 4%. Dow futures fell 1 per cent to 22,666.00.

In Asian markets, the Nikkei 225 index rebounded 3.9 percent, while South Korea's Kospi was little changed. Canadian markets were closed Wednesday, Boxing Day. In China, the Shanghai Composite shed 0.3% on Wednesday. Markets in Hong Kong and Australia reopened after Christmas. PulteGroup climbed 4.7 per cent to $25.85. In the previous six sessions, the S&P 500 managed to avoid a decline of greater than 1.5 percent just once, extending a December loss that exceeded 14 percent.

"It was probably a pretty good retail-oriented holiday and that probably has a lot to do with what's happening today", said Kim Forrest, a senior portfolio manager at Fort Pitt Capital Group.

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Earlier this week, the NY stock exchange recorded its worst-ever Christmas Eve plunge, following reports that US President Donald Trump had considered firing Federal Reserve chairman Jerome Powell.

There was a report late Friday that President Donald Trump was discussing the possibility of firing Powell, a move that could undermine confidence in the US financial system. According to some technical indicators, the S&P was at its most oversold level in years following Monday's sell-off.

Political turmoil this week has added to concerns about a cocktail of factors - including slowing growth, trade tensions, and more expensive refinancing after years of stimulus - that have weighed on global markets in recent months. Chris Weston of Pepperstone Group Limited said in a market commentary. It cited two people familiar with the matter. A senior Treasury official acknowledged that the reports about Trump's discussion of firing Powell was part of the catalyst for Mnuchin's call but not the sole reason. Wednesday through Friday are normal trading days.

Benchmark U.S. crude dropped 3.5 percent to settle at $44.61 a barrel in NY.

Energy stocks also fell as the price of US crude oil slid 2.9 percent a day after posting its biggest increase in two years. Each member of the FAANG cohort rallied at least 6.4 per cent, while energy producers surged as crude powered past US$46 a barrel.

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