Markets Right Now: Plans for steel tariffs sink U.S. stocks

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Financial-Markets-Wall-Street-1512

Investors wondered if that will lead to other countries putting up barriers that will hurt the global economy as well as profits for US exporters like Apple.

The Cboe Volatility Index (VIX -19.85) added 1.3 points, or 6.8%, bringing its monthly advance to 46.6% - its best month since August 2015.

The Dow Jones Industrial Average .DJI fell 380.83 points, or 1.5 percent, to 25,029.2, the S&P 500 .SPX lost 30.45 points, or 1.11 percent, to 2,713.83 and the Nasdaq Composite .IXIC dropped 57.35 points, or 0.78 percent, to 7,273.01. It was down as much as 586 points earlier.

The S&P industrial fell 0.88 per cent, with shares of Boeing and Caterpillar dipping more than 1.6 per cent.

Best Buy jumped around 5 percent after it reported strong same-store sales for the fourth quarter, recovering from falls overnight due to the US consumer electronics retailer's announcement of 250 small mobile phone store closures.

Equity markets in Paris, Frankfurt and Tokyo all lost more than two percent as United States trading partners and several leading industry groups criticized Trump's plan.

The worst performing sectors were energy, materials, and health care down 2.2%, 1.7%, and 1.5%, respectively. Apple gave up $4.65, or 2.6 per cent, to $173.47 and Pfizer shed $1, or 2.7 per cent, to $35.32. That could weaken stocks, which have been boosted by low rates.

A note from Oxford Economics warned of "tit-for-tat" retaliation from other countries and said the tariffs could "embolden" Trump to take more punitive actions if the manoeuvre is "deemed a political success". CNBC reported that Trump will make an announcement on tariffs at 11am ET (1600 GMT). Investors have been nervous about the possibility that the Fed may get more aggressive about raising interest rates to beat down inflation.

There could be more fireworks in the market on Thursday.

Meanwhile, the Federal Reserve is likely headed for three rate hikes in 2018, but investors are anxious that policymakers may be more aggressive. "We'd rather see strength coming in in the last hour", Hellwig said.

The yield on the key 10 year bond fell to 2.86% on Wednesday and to around 2.802% on Thursday - a sign that investors are selling out of shares and commodities and heading for the safest haven of all - US Treasuries.

The disclosure follows a report in the Wall Street Journal that the SEC sent subpoenas to dozens of companies demanding information about initial coin offerings and cryptocurrencies, which aren't bound by the same rigorous rules that govern public offerings of stock.

Dental supplies maker Patterson Companies plunged 22 percent after reporting weak earnings for the latest quarter.

At presstime oil is down 30 cents to $61.34 USA per barrel, gold is down 50 cents to $1317.40 U.S.an ounce, and the loonie is up slightly to 77.95 cents U.S. Brent crude, the global standard, shed 87 cents to $65.76 per barrel.

Gold dropped $1.70, or 1 per cent, to $1,305.20 an ounce.

CURRENCIES: The dollar dipped to 106.68 Japanese yen from 107.18 yen late Wednesday. The euro inched up to $1.2205 from $1.2203, and the British pound slipped to $1.3732 from $1.3771.

FCA US, the USA unit of Fiat Chrysler Automobiles NV (FCA) sales fell 1% in February to 168,326 vehicles.

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