- POSTED: 06 Aug 2014 05:18
US stocks fell sharply on Tuesday (Aug 5) in a sell-off analysts attributed to anxiety about a Wall Street correction and worries that the conflict in Ukraine could worsen.
NEW YORK: US stocks fell sharply on Tuesday (Aug 5) in a sell-off analysts attributed to anxiety about a Wall Street correction and worries that the conflict in Ukraine could worsen.
The Dow Jones Industrial Average dropped 139.81 points (0.84 per cent) to 16,429.47. The broad-based S&P 500 fell 18.78 points (0.97 per cent) to 1,920.21, while the tech-rich Nasdaq Composite Index lost 31.05 points (0.71 per cent) to 4,352.84.
Mace Blicksilver, director at Marblehead Asset Management, said the losses were spurred by the same negative sentiment that prompted big drops in US stocks last week.
More pundits have predicted a possible drop of 10 per cent or more in stocks, he said. US stocks have avoided a correction on this scale for more than two years. "It's continuing the trend from last week," said Blicksilver, adding that low trading volume has accentuated the moves.
Analysts also cited comments by Polish Foreign Minister Radoslaw Sikorski reported by Bloomberg News and others that said Russia had increased its military presence on the Ukraine border, suggesting a possible escalation in the conflict. US stocks fell further on Sikorski's comments. Analysts also cited disappointing earnings and lackluster economic data from China.
Target tumbled 4.4 per cent as it announced US$148 million in new expenses associated with a giant data breach suffered last winter. These include the cost of claims from payment card networks for customers whose financial data was stolen. Target also said results were marred by weak sales in the United States and Canada.
Oil companies fell as oil prices fell to their lowest level in six months on concerns about weak gasoline demand in the US. Dow members ExxonMobil and Chevron fell 1.9 per cent and 2.5 per cent respectively.
Drugstore chain Walgreens lost 4.2 per cent on reports the company will not seek to relocate its headquarters overseas to save billions in taxes. Discount retailer Dollar General advanced 3.4 per cent on a report the company is considering a bid for Family Dollar Stores that would challenge Dollar Tree's takeover of Family Dollar. Family Dollar rose 2.0 per cent, while Dollar Tree fell 2.2 per cent.
Bond prices rose. The yield on the 10-year US Treasury slipped to 2.48 per cent from 2.49 per cent on Monday, while the 30-year dipped to 3.28 per cent from 3.30 per cent.