Business

Investors flee stocks on global worries

Dow falls more than 600 points

Reuters

Traders work on the floor of the New York Stock Exchange on Wednesday.
Reuters Traders work on the floor of the New York Stock Exchange on Wednesday.

NEW YORK — Wall Street stock indexes tumbled on Wednesday as spooked investors ran for safety on global economic and political worries while U.S. Treasuries prices climbed and the U.S. dollar surged.

Among the bad news:

• The Dow Jones Industrial Average fell 608.01 points, or 2.41 percent, to 24,583.42

• The S&P 500 lost 84.59 points, or 3.09 percent, to 2,656.1

• The Nasdaq Composite dropped 329.14 points, or 4.43 percent, to 7,108.40.

With this, the S&P 500 and the Dow Jones Industrial Average erased their gains for the year. Meanwhile, the CBOE volatility index registered its highest close since February.

Investors have been unnerved by myriad issues including some disappointing earnings reports, uncertainty over Brexit, Italy’s budget spat with the European Commission, upcoming U.S. midterm congressional elections and pressure on Saudi Arabia over the killing of a prominent journalist.

“It looks like more panic and fear as the selling has continued to roll,” said Chris Zaccarelli, chief investment officer at Independent Advisor Alliance in Charlotte, N.C.

The U.S. dollar rose sharply against the euro to its strongest since August after PMI data showed business growth in the euro zone decelerated faster than expected due to waning orders.

U.S. Treasury debt prices rose as investors were wary of volatile equities, and benchmark 10-year Treasury note yields fell to three-week lows.

“It’s a big, global risk-off trade,” said Paul Zemsky, chief investment officer at Voya Investment Management in New York.

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“We’ve had some headwinds — higher interest rates affecting housing, tariffs causing input costs to manufacturers to go up, which makes earnings look not as stellar ... but that doesn’t mean the whole economy is rolling over.”

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