Markets Right Now: Stocks open lower on Wall Street

US Equity markets suffer precipitous descent

The S&P 500 was down 55 points, or 1.9 percent, at 2,824-on pace for its worst day since June.

If the market closes down at the end of today it will mark the ninth consecutive day of lower share prices on the NZX. Amazon skidded 4.8 per cent to $1,781.21 (U.S.).

The Dow Jones Industrial Average fell 831 points, its worst loss in eight months. The price of the bond with the lower interest rate, known as its coupon, will fall enough to raise the yield to mirror the higher rate.

Global interest rates are near all-time lows, while the U.S. is pushing interest rates higher given recent economic strength, among other things.

"It is starting to influence the local market".

Investors are nervous a trade war would slash profits.

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

"The New Zealand market has been declining from its highs for the last few weeks".

Those factors came at a time when there was not much newsflow from companies.

Technology stocks, the biggest winners in the market over the past year, took some of the worst losses.

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The Philadelphia Semiconductor index sank 2.19 per cent, with Intel down 1.7 per cent. Nvidia, down 4.2 per cent, and AMD, down 5.7 per cent, were also hit by Huawei's plan to make chips for servers.

USA stocks slipped Wednesday, putting the S&P 500 on course for a fifth consecutive session of declines as government-bond yields kept rising. As the base rate from the Fed increases, the value of existing bonds with low-interest drops, which means when bought they will yield higher given a lower base price (price you paid to acquire them). 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 sharply over the past five days.

The Dow gave up almost 828 points, or 3.15 percent, to 25,600. In 1987, stocks dropped more than 20 percent on a single day-Black Monday, Oct. 19-after a strong rally crashed into the Persian Gulf turmoil and trade deficits.

The gains translate to higher borrowing costs, which are rippling through the housing and automotive markets. Microsoft gave up 3.3 percent. Among the so-called FAANG stocks, Facebook Inc. fell 1.3 per cent, Amazon.com Inc. fell 3.6 per cent, Apple Inc. fell 2 per cent, Netflix Inc.

It sets up the Australian sharemarket for steep losses to open the session, with futures at 7:35am AEDT pointing to a fall of 109 points, or 1.8 per cent, at the open. The White House will would look more closely at Chinese investments in US companies in an attempt to protect USA technology on national security grounds. Among internet companies, Alphabet, Google's parent company, slid 2.3 per cent to US$1118.79.

Treasury yields rose again, tempting more investors away from stocks.

The 10-year Treasury note yield traded around 3.23 percent, while the two-year yield reached its highest mark since 2008. As of October 10, it's lasted 3,503 days.

Gina Martin Adams, chief equity strategist for Bloomberg Intelligence, said the stocks have become more volatile in the last few months because investors have concerns about their future profitability.

"Both companies highlighted rising costs, not only input costs but increasing operating expenses (and) marketing expenses", she said.

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