Dow opens sharply lower but recovers after briefly entering ‘correction’ territory

Benchmark 10-year note yields had surged to 2.885%, the highest since January 2014 but fell back to as low as 2.707% on Monday as the stock selloff accelerated.

Keep that in mind as you process the Dow’s breathtaking 1,175-point plunge on Monday.

Around half of that loss was recouped within minutes, but its gains for the year were still gone as of late afternoon.

European markets were lower today, with the Spanish Ibex Index falling 2.31 percent, STOXX Europe 600 Index falling 2.03 percent and German DAX 30 index dropping 1.99 percent. Japan’s Nikkei lost more than 6%, while stocks in Hong Kong dropped almost 5%.

The Canadian dollar was trading at 79.83 cents U.S., down from Monday’s average price of 80.11 cents. “It’s just been downhill from there”.

The tech-heavy Nasdaq composite rose 0.1 per cent to 6,978.21.

The index regained some of the losses by the end of the morning.

“We’re not used to getting washouts like this anymore”, Quincy Krosby, chief market strategist at Prudential Financial, told CNBC.

Apparently not many investors wanted to buy this dip. “But it is very important in psychological terms”, Krosby said.

Monday’s plunge comes after the Dow lost 666 points Friday – a 2.5 percent drop.

And over in the virtual world, Bitcoin prices dropped briefly below $7,000, before recovering slightly as of the time of writing to $7,050, still down 14% on the day.

They now predict there may be a few more interest rate rises on the horizon. The Dow soared by 5,000 points – it has never done that in a single year.

The market is coming off its worst week in two years.

The 4.6% slump was the index’s biggest percentage drop since August 2011, while the broader S&P 500 suffered a similar fate, down 4.1%. Declining issues outnumbered advancing ones on the NYSE by a 8.64-to-1 ratio; on Nasdaq, a 6.92-to-1 ratio favored decliners.

Banks fared the worst as bond yields and interest rates nosedived.

Market analysts have always been saying the market was overdue for a cooling-down period.

“Investors were dumping out of stocks”, NPR’s Uri Berliner reports. The most famous digital currency has fallen 69% from December’s record high, and nearly 56% from the start of the year. The Dow is still up 20 percent over that time, the S&P 500 15 percent. The major indexes had also notched record highs.

But the sell-off began last week after a solid U.S. jobs report fuelled expectations that the Federal Reserve will raise interest rates faster than expected.

A man walks past an electronics stock indicator showing the foreign exchange rate of the Japanese yen against the U.S. dollar in Tokyo on Tuesday. Tokyo stocks plunged with investor sentiment hit by a sell-off on Wall Street and the yen's surge agains

 

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