Dow has worst day in eight months as it drops 800 points

Wall Street slumps as investors dump tech stocks

Wall Street slumps as investors dump tech stocks

USA stocks plunged to their worst loss in eight months on Wednesday as technology companies continued to drop.

Stocks have slumped over the last week as a combination of strong economic data and positive commentary from Federal Reserve leaders sent bond yields rocketing higher as investors bet that interest rates will keep rising. That was its biggest loss since March 22.

"It can be pretty well validated by looking at monetary history that when you inflate the currency, distort interest rates, and live beyond your means and spend too much, there has to be an adjustment", Paul told RT on Tuesday, predicting that a stock market crash is just a matter of time.

"The tax cuts juiced earnings this year and that's not sustainable", he said.

"Clearly stocks are spooked by higher rates and maybe some inflation that seems to be creeping in", said Michael Farr, CEO of Farr, Miller & Washington. That was its worst drop in eight months.

The S&P 500 also fell 3.3 percent, marking its fifth straight decline, and the Nasdaq declined more than 4 percent, its worst percentage decline since June 2016. The Nasdaq composite, which has a high concentration of technology stocks, tumbled 244 points, or 3.2 percent, to 7,495. It's fallen 6.3 per cent over the last five days. The broader S&P 500 was down 47.07 points or 1.63 per cent, heading toward seven-week lows.

After a long stretch of relative calm, the stock market has suffered sharp losses over the last week as bond yields surged.

Microsoft dropped 4 per cent to $107.82. Amazon skidded 4.8 percent to $1,781.21.

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Stocks from emerging markets were also hard hit. Berkshire Hathaway dipped 4.1 per cent to $214.64 and reinsurer Everest Re slid 4.6 per cent to $218.97.

Luxury retailers tumbled after LVMH, the parent of Louis Vuitton, said its sales growth in China slowed.

Once-highflying tech has led markets lower as yields rise, with the 10-year Treasury note's yield reaching its highest point in more than a decade yesterday. Think of it this way, if the Treasury issues a $1000 bond paying 3 percent interest, investors will not pay $1000 for an older bond paying 2 percent interest.

"As stocks go up, tech goes up more than the stock market".

Gina Martin Adams, the chief equity strategist for Bloomberg Intelligence, said investors were concerned about the big increase in yields, which makes it more expensive to borrow money.

"Amazon recently announced they were increasing wages, Facebook is spending a ton on security", she said. The broader S&P 500 was down by even more, and had its worst day in more than six months.

Sears nosedived after the Wall Street Journal reported that the struggling retailer hired an advisory firm to prepare a bankruptcy filing that could come within days. The stock fell 35.7 percent to 38 cents in morning trading.

It followed a bleak session in Europe, where Germany's Dax and France's Cac 40 had each ended the day more than 2% lower. Over the years, Sears has closed hundreds of stores and sold several famous brands. West Texas Intermediate crude oil, a USA benchmark, fell 2.1 per cent to US$73.36 a barrel - and the discounted price of Western Canadian Select oil widened to US$47 a barrel. Brent crude, the global standard, lost 2.2 per cent to US$83.09 a barrel in London. United States gold futures settled up $1.9, or 0.16 percent, at $1,193.4.

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