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Why Has the Dow Jones Plunged 500 Points in One Day?

05 April, 2018, 02:02 | Author: Sara Gill
  • Торговая война продолжается Китай ответил на новые пошлины США

Trump also threatened the North American Free Trade Agreement over the weekend, while China on Monday responded to the White House's tariffs by imposing new taxes on US imports like pork and fruits, moves that sent shockwaves through the markets.

It was an unsettling start to the work week on Wall Street as the Dow Jones Industrial Average dropped more than 700 points shortly after 2 p.m. Monday. The S&P fell 50 points, and the NASDAQ plunged 193 points. The Russell 2000 index of smaller-company stocks fell 43 points, or 2.8 percent, to 1,486.

The S&P 500 opened below its 200-day moving average, a key technical level, and the Dow lost as much as 510 points before recovering some ground to stand 250 points lower at.

Shares of Amazon traded 0.7 percent stronger as of 1.55pm in NY, having fluctuated between gains and losses earlier in the day, as investors tried to assess the impact of US President Donald Trump's latest criticising tweets about the company.

Ford, General Motors, Fiat Chrysler and Tesla fell between 0.8 percent and 1.88 percent.

Shares of Tesla Inc ended the day down 5.1 percent after the company was reported to be making 2,000 Model 3s per week, missing its 2,500 target.

The major reports in the US this week include ISM Manufacturing PMI, ISM Non-Manufacturing PMI and Non-Farm Payrolls.

China bumped tariffs by up to 25 percent on 128 USA products, from frozen pork and wine to certain fruits and nuts, in response to US duties on imports of aluminum and steel.


According to the chief investment strategist of Nuveen, Brian Nick, the hope is that the new earnings season will stop the market's bleed out.

"Today it's the tech and tariff trade that has the market rattled", said Nick Raich, CEO of The Earnings Scout.

The Nasdaq gave up 203 points, or 2.9 percent, to 6,858. Much of Trump's criticism has come after unfavorable reporting in The Washington Post, which is owned by Amazon founder Jeff Bezos but is a separate company from Amazon. So far this year, the S&P 500 has had three times as many sessions (http://www.marketwatch.com/story/the-dow-and-sp-500-have-already-doubled-the-number-of-1-moves-seen-in-all-of-2017-2018-03-26) with a 1% move than in all of 2017.

Music-streaming service Spotify Technology SA stayed in the spotlight in its second day of trading on the New York Stock Exchange.

In particular though, over the past week President Trump has been going after one of the biggest market drivers, Amazon, which consequently sent the market tumbling.

Amazon.com was the biggest drag on the S&P 500, down 5.2 percent, as President Donald Trump continued his twitter attacks on the online retailer.

Investors have expressed concern that a trade war between the US and China could slow global commerce and hurt corporate commerce.

Spot gold added 1.1 percent to $1,338.04 an ounce. Samsung Electronics fell 2.02 percent. The 10-year note yield topped 2.76% and crude slipped. CBS shares rose 0.9 per cent.

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