Fear and uncertainty on Wall Street: investors, buckle up for a bumpy ride

Fear and uncertainty on Wall Street: investors, buckle up for a bumpy ride

Volatility is the word across the world’s markets – and with China’s stock sell-off continuing and debt crises in Greece and Puerto Rico unresolved, it doesn’t look like it will end anytime soon

by Suzanne McGee * The Guardian * July 9, 2015

A sea of red: markets around the globe are experiencing heavy sell-offs, especially in China where $3bn has evaporated seemingly overnight.

Are we heading for another stock market crash? The signs are ominous. The New York stock exchange – the world’s largest stock market – shut down for three and a half hours due to a mysterious “technical issue” on Wednesday; China’s speculative stock market plunged still further, despite tens of billions of dollars of spending on the part of the government in a futile attempt to halt the carnage; Greece is sailing into uncharted territory and teetering on the brink of leaving the Eurozone; and meanwhile Puerto Rico is mired in its own debt crisis.

Euripides and Sophocles couldn’t have asked for better material for a financial markets melodrama. Little wonder, therefore, that yesterday turned into a day of carnage on Wall Street, from the moment that US stocks prepared to open for trading early in the morning. There may be more to come.

According to Howard Silverblatt, senior index analyst for S&P Dow Jones Indices, with only an hour to go before the bell rang to signal the start of trading on the floor of the NYSE, the 1.03% decline in the price of futures contracts on the Standard & Poor’s 500 stock index – the market bellwether – was the biggest since the autumn of 2008, in the midst of the financial crisis.

By the time the day of market horror finally ended, trading had at least resumed on the NYSE, with exchange officials quickly quashing speculation of a cyber-attack. But if you’re looking at your 401k or other investment account statements in the coming days, you may want to brace yourself for a shock: the S&P 500 index tumbled 1.65% to 2,046.91, while the Dow Jones Industrial Average fell 1.46% to 17,517.76. Most traders reported seeing a sea of red on their screens, and each of the 10 sectors in the S&P 500, from financial stocks and retailers to mining companies, participated in the selloff.

More: http://www.theguardian.com/business/2015/jul/09/us-china-markets-volatility-greece-puerto-rico