Stocks - Wall Street Declines on Global Growth, Yield Curve Concerns
Investing.com - Wall Street fell on Friday after a decline in the European manufacturing sector caused concern over a global slowdown and a U.S. Treasury yield-curve inversion caused jitters.
The Dow fell 282 points, or 1.09%, by 9:55 AM ET (13:45 GMT) while the S&P 500 slipped 27 points, or 0.94%, and the tech-heavy Nasdaq composite was down 85.5 points or 1.08%.
The yield curve for the U.S. 3-Month Treasury and the U.S. 10-Year inverted for the first time since 2007, Bloomberg reported. Yield curve inversions, when the yields of shorter-dated bonds rise above those of longer-dated bonds, have often been pointed to as indicators of a recession.
Meanwhile, the preliminary index reading for manufacturing activity in the euro zone fell to its lowest level since 2013, supporting concerns of growth that prompted the Federal Reserve to extend its rate-hike pause.
"Today's economic numbers indicate the strong relationship that China has with Europe. China has been slowing down, especially in ordering industrial products and automobiles, and that is going to hit Germany out-proportionally," said Kim Forrest, chief investment officer at Bokeh Capital Partners.
"Moreover, the Fed's action on Wednesday show that they don't believe the economies of the world are strong enough to continue their raising program."
A decline in sales from retailers Nike (NYSE:NKE) and Tiffany & Co (NYSE:TIF) also weighed on markets. Nike slumped 4% after the sportswear company’s North American sales fell short of expectations, while Tiffany fell 0.6% after it reported a 1% fall in worldwide sales during the holiday season.
Semiconductor companies were down after a jump on Thursday. Advanced Micro Devices (NASDAQ:AMD) fell 1.9%, while Micron Technology (NASDAQ:MU) was down 2.6%.
Elsewhere, Facebook (NASDAQ:FB) rose 0.6%, while Apple (NASDAQ:AAPL) jumped 1% and Walgreens Boots Alliance (NASDAQ:WBA) inched up 0.5%.
In commodities, gold futures rose 0.3% to $1,311.05 a troy ounce, while crude oil slumped 1.4% to $59.16 a barrel. The U.S. dollar index, which measures the greenback against a basket of six major currencies, gained 0.1% to 96.097.
-- Reuters contributed to this report.
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