US stocks hit by broad sell-off


NEW YORK CITY: Wall Street was hit by a broad sell-off on Thursday (Friday in Manila), dragged lower by downbeat views of the world economy and US rate rise concerns.

Oil shares and banks led the way, but everything from consumer stocks to industrials registered significant losses, “anything related to global growth,” said Charlie Bilello of Pension Partners.

The Dow Jones Industrial Average finished down 254.15 points (1.44 percent) at 17,448.07.

The broad-based S&P 500 dropped 29.03 (1.40 percent) to 2,045.97, while the tech-rich Nasdaq Composite lost 61.94 (1.22 percent) at 5,005.08.

Bilello tied the slump to a wide fall in commodity prices, such as crude oil and copper, showing the weakness in global manufacturing.

“That’s putting pressure on the energy sector, the materials sector, industrials,” he said.
One big victim was heavy-equipment maker Caterpillar, whose shares sank 4.5 percent.
Banks lost heavily in the sell-off, with Bank of America falling 2.1 percent and Citigroup 2.6 percent.

In big oil, ExxonMobil lost 2.7 percent and Chevron 2.5 percent as crude prices dropped.
Embattled Canadian drug maker Valeant sank 6.6 percent after a judge refused to dismiss an insider trading lawsuit against the company and a major shareholder, activist investor William Ackman.

Valeant shares are now down more than 70 percent since the company’s accounting and distribution methods came under scrutiny in August.

Bilello said markets are also wary of the possibility of the Federal Reserve raising interest rates next month. Several Fed officials, in speeches Thursday, made clear an increase in the federal funds rate is a real possibility, though not a certainty.

“The question is will they hike if the market continues to go down like that,” he said. “The answer is ‘no.’”



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