US stocks relinquished all of their morning gains to end sharply lower in a volatile session weighed down by concerns over what would happen overnight in China’s stocks.
Selling accelerated towards the end of the session in another dramatically volatile session that had began on a high as investors staked their hopes on renewed efforts y China to halt the selloff in its equities by injecting a fresh stimulus.
The Dow Jones Industrial Average shrugged most of its gains during the day in the final 30 minutes of the session to record its biggest six day decline in points for the last eight years.
The blue chip index ended 204.91 or 1.3% lower at 15,666.44 points after trading within a 664.2 point range for the session.
The S&P 50 Index ended 25.59 points or 1.4% lower at 1,867.61 after trading higher for most of the session with all ten of its main sectors trading lower on the day.
The tech heavy Nasdaq Composite ended 19.6 points or 0.4% lower at 4,506.54 points.
“People are nervous about the potential volatility that could erupt or resurface in the market,” said Stephen Carl, principal and head equity trader at Williams Capital Group LP, told Bloomberg.
“They’re not sure what’s going to happen overseas, and that uncertainty is winning out.”
China’s Central bank, The People’s Bank of China, cut the country’s lending rates for the second time in two weeks in response to an 8% decline in its benchmark index, The Shanghai Composite.
“We would have preferred stocks open flat and rally into the close. Today’s action is not a good news for those who were expecting a V-shaped recovery,” Michael Antonelli, equity sales trader at R.W Baird & Co, told Market Watch
“Unlike the pullback last October, this correction has a serious tone to it — there are serious global growth issues that are not going to be resolved any time soon. We expect the correction to last longer,”
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