Dow Jones Industrial sinks more than 800 points as bond yields rise

Apple and Amazon both had their worst day in two and a half years.

Gold stocks rose by more than two per cent on a higher price of gold.

Wall Street stocks has plunged with major indices losing more than three percent in a sell-off prompted by the sudden jump in United States interest rates.

Earnings season should improve investors' moods through the end of the year, he writes, with a cycle peak in 2020 and the next major low not due until 2020.

Historically, nearly all bear markets since World War II have started with consistent and significant ongoing declines, rather than simple volatility.

"We've scratched our heads about the rise in stocks for the past 18 months".

The Dow and the S&P 500, the benchmark for many index funds, lost more than 3%. The benchmark US stock index hadn't suffered a five-day losing streak since November 2016, just before the presidential election. The Nasdaq composite dropped 173, or 2.2 percent, to 7,565. It's fallen 6.3 percent over the last five days.

The Dow fell 831 points, or 3.1%, to 25,598. As LPL Financials' Ryan Detrick notes, the S&P 500 just came off its least volatile third quarter since 1963, has been up for six consecutive months, and hasn't closed up or down more than 1% for more than three straight months, "one of the longest streaks ever".

Andrew Bascand, managing director of Harbour Asset Management, said the last time the New Zealand market dropped by this much in a day was probably in February when there was a similar period of rising bond yields. On August 22, it exceeded the previous record length, which ran October 1990 to March 2000. Even utility stocks, which tend to pay big dividends, fell slightly Wednesday.

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The Dow Jones industrial average lost 248, or 0.9 percent, to 26,183, and the Nasdaq composite dropped 145, or 1.9 percent, to 7,589. Boeing lost 4 percent to $370.04 and Alphabet, Google's parent company, gave up 3.2 percent to $1,109.08. Companies that sell non-essentials to consumers dropped 1.7 percent. Berkshire Hathaway dipped 4.7 percent to $213.10 and reinsurer Everest Re slid 5.1 percent to $217.73.

The biggest driver for the market over the last week has been interest rates, which began spurting higher following several encouraging reports on the economy.

U.S. stocks notched solid gains in the third quarter as investors brushed aside worries about trade wars and focused on strong corporate earnings and solid United States economic data.

The 10-year Treasury yield remained at 3.20 percent, about where it was late Tuesday, after earlier touching 3.24 percent.

Technology and internet-based companies are known for their high profit margins, and many have reported explosive growth in recent years, with corresponding gains in their stock prices.

"Amazon recently announced they were increasing wages, Facebook is spending a ton on security", she said. "Semiconductors have the most exposure to China out of segments in the S&P 500".

Sears Holdings plunged 32 percent after the Wall Street Journal said the debt-laden retailer was preparing for a possible bankruptcy.

The NZX50 fell 1.15 per cent last week and this week is down around 1.8 per cent.

Ivan Feinseth, Chief Investment Officer at Tigress Financial Partners, said that although the losses caught him off-guard, he thought many investors were unduly frightened by the rising rates.

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