S&P 500, Dow Jones, Nasdaq continue lower following massive selloff.
U.S. stocks traded sharply lower on Thursday, as markets resumed their downtrend following Wednesday’s sudden plunge.
The large-cap S&P 500 Index (NYSEARCA:SPY) declined 2.1% to 2,728.36, a new three-month low. All 11 primary sectors finished lower, with energy and financials leading the declines.
Dow industrials (NYSEARCA:DIA) fell 546.31 points, or 2.1%, to 25,052.43.
The Nasdaq Composite Index (NYSEARCA:QQQ) reversed gains to finish down 1.3% at 7,329.06.
The Chicago Board Options Exchange (CBOE) Volatility Index (NYSEARCA:VXX) rose to fresh six-month highs on Thursday, as risk-off trading continued to influence investor sentiment. The so-called “fear index” settled at 26.32, which is well above the historic average.
Equity markets on Wednesday experienced their worst single-day drop since February, with the Dow shedding more than 800 points. The selloff triggered massive declines in Asia, with China’s benchmark Shanghai Composite Index plunging more than 5%.
In economic data, U.S. consumer inflation rose less than expected last month, though the underlying trend continued to show rising cost pressures throughout the economy. The consumer price index (CPI) rose 0.1% in September and 2.3% annually, the Department of Commerce reported. Core inflation, which strips away volatile goods such as food and energy, rose 2.2% year-over-year.
Separately, the Labor Department said jobless claims rose by 7,000 last week to a seasonally adjusted 214,000.
The Final Word: Volatility made a stunning return on Wednesday, possibly signaling the death knell for the bull market. Rising bond yields and a rollover in the tech sector are expected to keep share prices under pressure for the foreseeable future.