CONCERN over faltering global economic growth yesterday ended a three-day rally on Wall Street, led by declines in energy and materials shares, a day after shares rose on the Federal Reserve’s decision to raise interest rates.
The Dow Jones industrial average fell 253.25 points, or 1.43 per cent, to 17,495.84, the S&P 500 lost 31.18 points, or 1.5 per cent, to 2,041.89 and the Nasdaq Composite dropped 68.58 points, or 1.35 per cent, to 5,002.55.
China’s slowdown has been transmitted to the rest of the world through a fall in oil and commodities prices, said Hugh Johnson, chief investment officer of Hugh Johnson Advisors LLC in Albany, NY, which he said “is raising serious questions about global demand and the global economy.”
Oil prices extended recent declines on persistent oversupply worries and as the dollar hit a two-week high. Dow components Exxon and Chevron were down, by 1.5 per cent and 3.1 per cent, respectively. Newmont Mining, which fell 7.7 per cent to $17.61, led declines on the materials index, which fell 1.9 per cent. The S&P energy index fell 2.5 per cent.
Apple was down 2.1 per cent at $108.98 after concerns deepened on Wall Street about potential weakness in iPhone shipments. It was the biggest drag on the S&P and the Nasdaq. Among other decliners, Oracle was down 5.1 per cent at $36.93 after its third-quarter profit forecast disappointed.
However, Pandora Media soared 13.54 per cent to $15.26 after the media-streaming company said new music royalty rates were “balanced”.
FedEx was up two per cent at $151.84 after it reported a better-than-expected quarterly profit.