Wall Street was set to open sharply lower for a second straight day on Thursday after China allowed the yuan to fall further and oil prices slid to near 12-year lows, raising concerns over the state of the global economy.
China allowed the biggest fall in the yuan in five months, and Shanghai stocks were halted for the second time this week after another brutal selloff.
With Beijing accelerating the yuan’s depreciation to make its exports more competitive, investors fear China’s economy is even weaker than had been imagined.
Adding to the gloom, oil slid below $33 a barrel to near 12-year lows due to worries over weaker demand from China and an over-supplied market.
Billionaire investor George Soros, speaking at an economic forum in Sri Lanka, drew similarities between the present environment and the financial crash of 2008, Bloomberg reported.
He said global markets are facing a crisis and investors need to be very cautious.
The World Bank also cut its global economic growth forecast for 2016, saying the weak performance of major emerging market economies will tamp activity overall, as will anemic showings from developed countries such as the United States.
Dow e-minis were down 380 points, or 2.26 percent, with 99,258 contracts changing hands at 8:13 a.m. ET (1313 GMT). S&P 500 e-minis were down 45 points, or 2.27 percent, with 578,860 contracts traded. Nasdaq 100 e-minis were down 130.25 points, or 2.93 percent, on volume of 108,831 contracts.
“The moves we have seen in the past few days feel very similar to the ones we saw in August,” said Scott Brown, chief economist at Raymond James in St. Petersburg, Florida.
The August free-fall, which saw the Dow lose 1,000 points at one point in intraday trading, was triggered by the same factors – weakening of the yuan and a sharp slide in oil prices.
“While investors are concerned about the slowdown in the Chinese economy, the question now is whether the authorities have the ability to prop up the market,” Brown said.
Data showed the number of Americans filing for unemployment benefits fell last week from a more than five-month high. The report comes ahead of the government’s closely watched monthly employment report due for release on Friday.
Shares of Apple were down 2.8 percent to $97.87 in premarket trading, following reports of slowing shipments of the iPhone 6S and 6S Plus.
Oil majors Exxon and Chevron were down more than 2.3 percent, while miner Freeport-McMoRan fell 5.9 percent to $5.85.
Tech majors Facebook, Amazon and Yahoo were all down more than 2 percent.
The post Wall Street Shaken by China Turmoil, Oil Slide appeared first on TRUNEWS with Rick Wiles.
from TRUNEWS with Rick Wiles http://ift.tt/1mEWlHK
via IFTTT
No comments:
Post a Comment