World markets are poised for good or bad news from the US fiscal cliff negotiations in Washington DC, where politicians are working through the weekend to avoid budget cuts and higher taxes.
On Friday, Wall Street opted to believe a last-minute deal was not likely, sending the Dow Jones Industrial Average tumbling 158.20 points, or 1.2%, to 12,938.11, capping a five-day slide that has shaved 374 points off the index and pushed it to the lowest level in a month.
The Dow, which hit a two-month high as recently as last Tuesday, is now in negative territory for December, traditionally one of the strongest months of the year for stocks.
The declines were broad-based. All 10 sectors of the S&P 500 index, and all 30 Dow components, declined. More than 95% of the S&P 500 stocks dropped.
The S&P 500 was down 1.0% to 1402.43 and the Nasdaq Composite was down 1.1% to 2960.31.
However, trading volumes were thin, which can amplify moves down or up. Just 2.4 billion shares changed hands in New York Stock Exchange composite trading—compared with 2012's daily average of 3.6 billion shares and making it the third-lowest full-day volume in 2012.
The impasse has had a positive effect on the US dollar, which on Friday hit its highest level against other currencies in more than two weeks.
The Wall Street Journal Dollar Index, which tracks the US dollar against a basket of currencies, was trading at 70.34, its highest level since December 10. Delays in US budget talks typically support the dollar and yen because of the currencies' high liquidity and safe-haven status.
In commodities, oil futures slipped under $US91 a barrel, as US inventories shrank less than expected.
Futures for February delivery settled down 7USc at $US90.80 a barrel in New York in light trading.
The February contract for gold rose $US3, or 0.2%, to settle at $US1663.70 an ounce but was down 3% for the month.
This article is tagged with the following keywords. Find out more about MyNBR Tags
- Xero directors Drury, Winkler and Morgan cash in on 35% share price rally
- iPredict closing down due to money laundering risk
- Tech expert's complaint about 'snake oil' ad upheld
- MARKET CLOSE: NZ shares mixed; Spark, Fletcher join Asian rally, Xero drops as Drury trims stake
- Serco's prison report challenge: Hide and Davis go head-to-head
Most listened to
- “A very ballsy thing to do” – Rodney Hide and Kelvin Davis discuss Serco’s response to Correction’s Mt Eden Prison report
- “The response from shareholders has been overwhelming” — A2 Corporation chief executive Geoff Babidge
- Greg Gent says a board of 13 people is "prehistoric"
- Arvida CEO Bill McDonald on his company's half-year net profit
- Lance Wiggs on the future of food exports
- Auckland Councillor Chris Darby on the Council's alternative funding report
- Nevil Gibson discusses his latest Editor's Insight on oil prices
- Campbell Gibson, Nick Grant and Chelsea Armitage chat about the inner workings of New Zealand media
- Paul Brislen discusses the 'snake oil' sales tactics of SalesConcepts
- Fonterra chief executive Theo Spierings reveals his ambitious China plan
- UDC Finance chief executive Wayne Percival talks about the company's profit
- Hamish McNicol discusses the latest court stories