Dow Plunges 1000 Points As Selling Spreads

The 30-stock average's early free fall briefly pushed it into "correction" territory for the first time in two years after it dropped 10% from its recent record high on January 26. It's still up 15 percent over the past year.

Stocks fell further and further as the day wore on and suffered their fifth loss in the last six days.

With Wall Street's quarterly earnings season more than half-way through, 78.3 percent of the S&P 500 companies that have reported so afar have beaten profit expectations, above the 72 percent beat-rate in the past four quarters. Those included technology companies, banks, and retailers and travel companies and homebuilders.

After hitting a high two weeks ago, US stocks started to tumble last week after the Labor Department said workers' wages grew at a fast rate in January. Investors worry stimulus from the tax cuts and the added government spending will overheat an already strong economy, pushing up wages and prices and sparking inflation. It could prompt the Federal Reserve to raise interest rates at a faster pace, which would act as a brake on the economy. The Dow finished the day down by 1,032.89 points, or 4.15% at 23,849.23. Boeing, Goldman Sachs and Home Depot took some of the worst losses.

The Dow and S&P 500 rose more than 1 percent on Wednesday, extending their rebound from the previous session, while oil prices fell sharply after US data fanned fears of oversupply. It hasn't been that low since mid-November. The Nasdaq composite slid 60 points, or 0.9 percent, to 6,716.

The losses were broad.

Like many others, BlackRock analysts described the rout as a buying opportunity, seeing the leveraged products moves as essentially driven by jitters over recent equity gains on one hand, and the possibility of higher interest rates on the other.

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World stocks were also on track for their worst week since 2011, knocked by a 4 percent decline in Chinese stocks.

Other companies rose after reporting quarterly results and outlooks that beat Wall Street's forecasts. The stock dropped $28.24 to $59.80.

U.S. BUDGET BATTLE: Uncertainty overshadowed the fitful market recovery as Senate leaders brokered a long-sought budget agreement Wednesday that would bring the Pentagon and domestic programs an extra $300 billion over the next two years. Brent crude, the benchmark for global oil prices, rose 54 cents to $67.40 a barrel in London.

Are you concerned about the Dow decline? That also sent the pound higher. The Nasdaq closed up 2.1% and the S&P 500 rose 1.7%.

Bond prices wobbled and turned higher.

Elsewhere in Asia on Wednesday, Australia's S&P/ASX 200 ended up 0.8% while South Korea's Kospi index dropped 2.3%. "The trigger has been the really fast rise in bond yields", said Evan Brown, director of asset allocation at UBS Asset Management.

Equities for years have looked relatively attractive compared to the low yields offered by bonds, but the rise in Treasury yields has diminished the allure of stocks, especially with stock valuations at historically expensive levels.

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