Sun, Feb 11, 2018 - Page 16 News List

US ends brutal week with surge

ROLLER-COASTER SESSION:Asian and European trading floors showed hefty losses, while the Dow’s weekly losses were still the worst in more than two years

AFP, NEW YORK

Wall Street stocks ended a bruising week on a benign note courtesy of a late-session surge on Friday, while equity markets in Europe and Asia fell sharply in volatile trading.

US stocks lurched back and forth in a roller-coaster session, opening decisively higher, then tumbling deep into the red at midday before rising again and finishing strong.

Europe’s key markets extended the recent days’ downturn to show substantial losses at the close following another spectacular drop in Asian shares.

“How long can the sell-off last? That is the million — if not billion — dollar question,” Forex.com’s Fawad Razaqzada said, adding that the absence of massive buyers at low price levels was a worry.

“We had plenty of volatility today and we’ll see more next week,” Wunderlich Securities chief market strategist Art Hogan said.

“You have to go back to the financial crisis days to see this kind of volatility,” he added.

The market’s best hope for escaping the cycle is if next week’s US inflation data contain no bombshells and bond yields do not increase from the range they are at, Hogan said.

The Dow Jones Industrial Average ended up 1.4 percent at 24,190.90 after swinging more than 1,000 points during the session.

In spite of the robust finish, the Dow’s weekly losses were the worst since January 2016 and investors are bracing for more turbulence ahead.

“No one can say for sure, but things don’t look pretty out there, given that the sharp falls haven’t been bought this time around. So, things could get ugly really quick,” Razaqzada said.

Paris, London and Frankfurt all lost more than 1 percent.

Asian trading floors were a sea of red, with concerns about tighter interest rates, particularly in the US.

Key figures at 10pm GMT on Friday

New York, DOW: up 1.4 percent at 24,190.90 (close)

New York, S&P 500: up 1.5 percent at 2,619.55 (close)

New York, NASDAQ: up 1.4 percent at 6,874.49 (close)

London, FTSE 100: down 1.1 percent at 7,092.43 points (close)

Frankfurt, DAX 30: down 1.3 percent at 12,107.48 (close)

Paris, CAC 40: down 1.4 percent at 5,079.21 (close)

Euro STOXX 50: down 1.5 percent at 3,255.99

Tokyo, Nikkei 225: down 2.3 percent at 21,382.62 (close)

Hong Kong, Hang Seng: down 3.1 percent at 29,507.42 (close)

Shanghai, Composite: down 4.1 percent at 3,129.85 (close)

Euro/dollar: up at US$1.2249 from US$1.2246

Pound/dollar: down at US$1.3828 from US$1.3912

Dollar/yen: up at ¥108.78 from ¥108.74

Source: AFP


Hong Kong, Shanghai and Tokyo were among the worst hit as investors piled into haven assets such as gold and the yen.

Oil prices also tumbled, with US benchmark West Texas Intermediate losing US$1.95 to US$59.20 per barrel to suffer its biggest weekly loss in two years.

Analysts attributed the drop to worries about oversupply given strong US oil output and to a spillover in volatility from equity markets.

“Investments over the coming weeks could be something of an emotional roller-coaster ride,” Interactive Investor head of investment Rebecca O’Keeffe said.

A key trigger of the stocks pullback was a strong US jobs report a week ago that also showed rising US wage growth, fueling speculation that the Federal Reserve would lift rates more than the three times already forecast this year.

At the same time, the European Central Bank is on the verge of ending its crisis-era stimulus, while the Bank of England warned its main interest rates could rise faster than expected this year.

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