Stocks tumble on global worries

23 Dec 2015 | Author: | No comments yet »

Stocks tumble in heaviest trading day of 2015 as banks and tech stocks lead declines.

NEW YORK — Stocks plunged across all sectors in the heaviest trading of the year Friday as enthusiasm over a long-awaited increase in U.S. interest rates faded. Another drop in energy prices sent oil stocks lower again, and worries about weak global growth weighed on shipping and other transportation companies. Japan’s central bank announced some changes to its stimulus program, saying it will spend a bit more on exchange-traded funds for companies that increase hiring and investment. Investors were disappointed the Bank of Japan didn’t take further action, according to Ryan Larson, head of U.S. equity trading for RBC Capital Markets.

Stocks had rallied over the first three days and jumped Wednesday after the Federal Reserve raised interest rates for the first time in almost a decade. But over the next two days, stocks were hit by some of the worries that have dogged them all year, like weakness in the Chinese economy, slowing global growth, and skidding prices for energy and metals. U.S. stock trading was even more volatile than usual Friday because of the simultaneous expiration of several kinds of futures and other contracts that investors use to place bets on indexes and individual stocks.

RERUNS: The global market went through a similar slump about two weeks ago, when the European Central Bank ramped up its stimulus efforts, but didn’t do nearly as much as expected. Those slumps show that investors will continue keeping an eye on the words and deeds of central banks in struggling Europe and Japan as well as the U.S. for the foreseeable future. Transocean gave up 74 cents, or 5.7 percent, to $12.26, while Ensco lost $1.08, or 7 percent, to $14.31, and Diamond Offshore Drilling dipped 70 cents, or 3.3 percent, to $20.47.

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