Dow Jones falls by more than 1000 amid high interest scare

Dianna Christensen
February 17, 2018

At the end the index closed with increase of or 1.70% to 24,601.27 points.

Due to rising concerns and worry about the probability of higher interest rates, the market situation has been on the edge over the past week.

S&P 500 measures the performance of 500 widely held common stocks of large-cap US companies.

AmerisourceBergen Corp also soared, but were off highs, up 8.43% at US$96.94 after Wall Street Journal reported that Walgreens Boots Alliance Inc. had made a takeover approach for the company and that both companies had been in talks over the past few weeks.

The three major indexes plummeted into correction - a 10% drop from recent peaks - last week after a long, unusually stable period that helped catapult them to record highs.

Cleveland Fed President Loretta Mester, a voting member in the central bank's rate-setting committee this year, said the recent stock market sell-off and jump in volatility will not damage the economy's overall strong prospects.

The correction was long overdue and may last another few weeks, but there still may be room for US stocks to rise another 10 percent to 15 percent before the end of the year, said Douglas Cohen, a managing director at Athena Capital Advisors.

USA stocks rose on Monday as the major indexes rebounded from their worst weekly performances in two years. The Nasdaq composite gained 107 points, or 1.6 percent, to 6,981. However, the Nasdaq was still holding onto this year's gains of 1.4 percent at the close of yesterday's session.

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Bond prices edged higher.

"The market was probably 10 to 15 percent overvalued, and we got a 10 percent correction", said Ablin, who said he moved one client into the stock market Friday.

On the other hand, substantial weakness was visible among gold stocks, as reflected by the 2.2 percent slump by the NYSE Arca Gold Bugs Index. The U.S. consumer-price index will be released January and may reveal the extent the tighter jobs market is creating inflation. Bond yields rise as prices fall.

United States stocks finished solidly higher on Monday (Feb 12) following an upbeat session free of the jolts of volatility that plagued equities for more than a week.

Benchmark U.S. crude gained 62 cents, or 1 percent, to $59.82 a barrel in NY. The S&P 500 energy index is down 12.7 percent over the past month. Brent crude, used to price global oils, lost 20 cents to $62.59 a barrel in London.

Comcast stock slipped 3 cents to $38.54 while Disney added 30 cents to $103.39.

Japan's Nikkei 225 average lost 2.8 percent to 21,240.05 in early trading Friday.

CURRENCIES: The dollar rose to 108.58 yen from 108.53 yen.

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