Stocks on Wall Street dropped the most in three months as the effects of a potential interest-rate hike in China added to growing criticism of the US Federal Reserve's stimulus programme.The Dow Jones Industrial Average slid below 11,000 in early trading
Stocks on Wall Street dropped the most in three months as the effects of a potential interest-rate hike in China added to growing criticism of the US Federal Reserve's stimulus programme.
The Dow Jones Industrial Average slid below 11,000 in early trading after finishing at its lows in the previous session. But the index was above that level, at 11,023.50, at the close (10am NZ time) – the lowest since October 19.
The drop of 178.47 points, or 1.6%, was the biggest one-day fall since August 11.
Alcoa was the Dow's worst performer, falling 2.8% as worries over rate hikes in China weighed on basic materials stocks.
Chinese authorities also announced new limits on the ability of foreigners to buy residential or commercial property on the mainland.
Exxon Mobil shed 2.4% after a Nigerian militant group sized seven workers in a raid on an Exxon facility and threatened to launch a major operation against other oil facilities across the Niger Delta.
The Nasdaq Composite plunged 1.75% to 2469.84 and the S&P 500 index dropped 1.6% to 1178.34.
Other markets: Europe, Asia down
European sharemarkets fell as concerns simmered over whether Ireland, and potentially Portugal, will be forced to accept bailouts from the European Union.
The Stoxx Europe 600 index closed down 2.3% at 265.98.
The UK's FTSE 100 index fell 2.4% to 5681.90, Germany's DAX lost 1.9% to 6663.24, and Ireland's ISEQ index fell 1.7% to 2651.80. France's CAC-40 index ended down 2.6% at 3762.47, its lowest close since October 12.
Asian sharemarkets fell across the board on Chinese monetary tightening, sending the Shanghai Composite down 4% to 2894.54 – its second sharp selloff in three days, after the benchmark fell 5.2% on Friday.
The drop triggered an afternoon selloff in some other markets, including Hong Kong and India. Seoul-listed shares were weighed down by a rate increase from the Bank of Korea.
Hong Kong's Hang Seng Index shed 1.4% to 23693.02, India's Sensex lost 2.2% to 19865.14 and Japan's Nikkei Stock Average fell 0.3% to 9797.10.
Korea's Kospi fell 0.8% to 1899.13, while Australia's S&P/ASX 200 rose 0.3% to 4700.28 and Taiwan's Taiex gained 0.9% to 8312.21.
Commodities: Oil, gold down
Oil prices fell to their lowest level in two weeks. Light, sweet crude for December delivery gave up $US2.42, or 2.9%, to fall to $US82.44 a barrel in New York.
Prices hit an intraday low of $US82.61, the lowest point since November 1. Brent crude on the ICE futures exchange fell $US1.90, or 2.2%, to $US84.88 a barrel.
Investors dumped gold as they felt less of a need for the metal as an inflation hedge. The most actively traded gold contract, for December delivery, was down $US38.70, or 2.8%, at $US1329.80 an ounce in New York.
Currencies: Euro down, dollar up
The euro fell below $US1.35 to its lowest level against the dollar since September 28 as investors were spooked over the possibility of an Irish bailout.
The euro was at $US1.3516 from $1.3569 late on Monday. The dollar was at ¥83.49 from ¥83.19, while the euro was at ¥112.78 from ¥113.00. The UK pound traded at $US1.5867 from $US1.6046. The dollar fetched 0.9929 Swiss franc from 0.9856 franc.
