US stocks tumble on weak ECB outlook

US stocks tumble on weak ECB outlook

NYSE Mar7
Traders work on the floor of the New York Stock Exchange. (AP Photo/Richard Drew)

NEW YORK: Wall Street stocks tumbled on Thursday (Mar 7) after a downcast European Central Bank policy announcement sharpened worries about slowing global growth.

The Dow Jones Industrial Average dropped 200.23 points (0.78 per cent) to 25,473.23, its fourth straight decline.

The broad-based S&P 500 shed 22.52 points (0.81 per cent) to 2,748.93, while the tech-rich Nasdaq Composite Index sank 84.45 points (1.13 per cent) to 7,421.47.

The declines came after the ECB slashed its 2019 economic growth and inflation forecasts and announced fresh stimulus, with new rounds of cheap loans to banks to keep credit flowing.

"We're coming out of, and maybe we still are in a period of continued weakness and pervasive uncertainty," ECB chief Mario Draghi told reporters.

The announcement came only a day after the Organisation for Economic Cooperation and Development cut its global growth forecast for the year.

"For once, we can see the problems with European stocks jump to the American market," said Gregori Volokhine of Meeschaert Financial Services.

"The ECB's bearish tone had a big effect on investor psychology."

Declines were fairly broad-based, with Dow members Caterpillar, Goldman Sachs and Home Depot all losing one percent or more.

Large tech names were also under pressure. Amazon, Facebook and Netflix all dropped two percent or more.

Supermarket chain Kroger sank 10 per cent after reporting disappointing fourth-quarter profits. Analysts said investments on e-commerce offerings had dented profitability.

Burlington Stores dived 11.9 per cent following a lackluster fourth quarter. Comparable sales rose just 1.3 per cent, compared with a 5.9 per cent rise in the year-ago period.

Source: AFP/de

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