Not very merry: US stocks slump ahead of Christmas holiday

Not very merry: US stocks slump ahead of Christmas holiday

U.S. stocks fell sharply Monday, sending the Dow Jones Industrial Average down more than 400 points and extending the market’s losses after its worst week in more than seven years.

Health care, technology and industrial stocks took some of the heaviest losses in the broad sell-off, which followed news that the U.S. Treasury Secretary called CEOs of six major banks Sunday in an apparent attempt to stabilize jittery markets.

Trading was choppy and volume was light during a shortened trading session ahead of the Christmas holiday Tuesday.

“It’s already been a roller coaster today,” said Craig Birk, chief investment officer at Personal Capital. There’s some repositioning going on, but it’s a light day and probably a lot of people are staying out of it.”

The S&P 500 index fell 43 points, or 1.8 per cent, to 2,373 as of 11:51 a.m. Eastern Time. The Dow lost 436 points, or 2 per cent, to 22,008. The Nasdaq skidded 72 points, or 1.1 per cent, to 6,260. The Russell 2000 index of smaller-company stocks gave up 5 points, or 0.4 per cent, 1,286.

The major indexes are down 16 to 26 per cent from their autumn highs. Barring huge gains during the upcoming holiday period, this will be the worst December for stocks since 1931.

The market briefly bounced back from its steep opening slide, then veered lower again around midmorning after President Donald Trump tweeted another volley of criticism at the Federal Reserve.

The president tweeted that Fed officials “don’t have a feel for the Market, they don’t understand necessary Trade Wars or Strong Dollars or even Democrat Shutdowns over Borders.”

He added: “The Fed is like a powerful golfer who can’t score because he has no touch – he can’t putt!”

Trump has argued that the Fed is hindering the economy through its rate increases, which are intended to prevent inflation from rising too high.

Investors have grown jittery in recent weeks amid concern that U.S. economic growth will slow and hurt corporate profits. The rise in interest rates has helped stoke those worries. Traders have also fretted over the U.S.-China trade dispute and signs that economies in Europe and China are slowing.

Coming off a turbulent week of trading on Wall Street, Treasury Secretary Steven Mnuchin on Sunday disclosed calls with the heads of Bank of America, Citigroup, Goldman Sachs, JP Morgan Chase, Morgan Stanley and Wells Fargo. Mnuchin said the CEOs all assured him they have ample money to finance their normal operations, even though there haven’t been any serious liquidity concerns rattling the market. But the calls added to the underlying worries that have gripped markets of late.

Bank stocks declined Monday. Wells Fargo slid 1.9 per cent to $44.26.

Health care and technology stocks accounted for a big share of the selling. Microsoft fell 2.2 per cent to $96.05. Johnson & Johnson lost 4 per cent to $122.99.

Oil prices, which have sunk on concerns about the state of the global economy and also oversupply in the market, continued to slide. Benchmark U.S. crude fell 3.1 per cent to $44.18 a barrel in New York. Brent crude, used to price international oils, declined 2.6 per cent to $52.43 a barrel in London.

The decline in oil prices weighed on energy stocks. Hess slumped 8.1 per cent to $38.11.

Bond prices rose. The yield on the 10-year Treasury note fell to 2.77 per cent from 2.79 per cent late Friday.

The dollar fell to 110.50 yen from 111.31 yen on Friday. The euro strengthened to $1.1415 from $1.1370.

In Christmas holiday-thinned half-day trading in Europe, France’s CAC 40 fell 1.5 per cent, while the FTSE 100 index of leading British shares slid 0.5 per cent. Germany’s DAX was closed.

Major indexes in Asia finished mixed. South Korea’s Kospi dropped 0.3 per cent, while Hong Kong’s Hang Seng lost 0.4 per cent on a short trading day. Australia’s S&P ASX 200 added 0.5 per cent. Markets in Japan and Indonesia, which is reeling from a weekend tsunami that has killed at least 373 people, were closed.

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Grant Hunter, associate minister of red tape reduction, is proud of the work his ministry has done over the COVID-19 pandemic. (Photo contributed)
Alberta gets A for red tape reduction

The Alberta government is getting a thumbs up for its work on… Continue reading

The first Pfizer-BioNTech COVID-19 vaccine dose in Canada is prepared at The Michener Institute in Toronto on Monday, Dec. 14, 2020. (THE CANADIAN PRESS/Frank Gunn)
Not all long-term care workers have received their vaccines including a Red Deer facility

There continues to be confusion in long-term care and supportive living facilities… Continue reading

Cattle graze winter pasture in the foothills of the Canadian Rockies near Longview, Alta. on Jan. 8, 2004. Concern over the provincial government’s decision to drop a coal policy that has protected the eastern slopes of the Rockies for decades is growing among area communities. At least six cities, towns and municipal districts in southwest Alberta have now expressed concern about the decision and the fact it was made with no consultation. The latest is Longview, where mayor Kathie Wight is drafting a letter to the government opposing the move. THE CANADIAN PRESS/Jeff McIntosh
More southern Alberta communities voice concern over province’s plans to expand coal

Concern over the Alberta government’s decision to drop a coal policy that… Continue reading

Some residents say there is no longer an effective Nordegg fire department to respond to emergencies in the West Country. (Contributed photo).
Some Nordegg residents worry about lack of emergency response in the West Country

The possibility of wildfires or accidents is ‘scary’ says former fire leader

FILE - Pittsburgh Penguins general manager Jim Rutherford has his final meeting of the season with the media at the NHL hockey team's practice facility in Cranberry, Pa., in this Wednesday, May 9, 2018, file photo. Pittsburgh Penguins general manager Jim Rutherford, a Hall of Famer who helped lead to a pair of Stanley Cup titles, resigned abruptly on Wednesday, Jan. 27, 2021. (AP Photo/Gene J. Puskar, File)
Penguins GM Jim Rutherford, who oversaw Cup wins, resigns

Penguins GM Jim Rutherford, who oversaw Cup wins, resigns

Outfielder George Springer is shown in a screengrab from a virtual news conference he took part in on Wednesday, Jan.27, 2021. Springer says he's excited to be a part of a young, talented team like the Toronto Blue Jays, a club he believes has plenty of potential. THE CANADIAN PRESS/HO
Blue Jays introduce outfielder George Springer after signing him to six-year deal

Blue Jays introduce outfielder George Springer after signing him to six-year deal

Bucs fans set to cheer inside, outside Super Bowl stadium

Bucs fans set to cheer inside, outside Super Bowl stadium

Hamilton Tiger Cats quarterback Jeremiah Masoli tries to fend off Saskatchewan Roughrider Zack Evans during first half CFL football game action in Hamilton on Thursday, June 13, 2019. THE CANADIAN PRESS/Peter Power
Quarterback Jeremiah Masoli signs extension with Hamilton Tiger-Cats

Quarterback Jeremiah Masoli signs extension with Hamilton Tiger-Cats

Ottawa Senators defenceman Thomas Chabot (72) tries to clear Vancouver Canucks centre Jay Beagle (83) from in front of Senators goaltender Marcus Hogberg (1) during second period NHL action in Vancouver, Wednesday, January 27, 2021. THE CANADIAN PRESS/Jonathan Hayward
Demko dynamite as Vancouver Canucks beat Ottawa Senators 5-1

Demko dynamite as Vancouver Canucks beat Ottawa Senators 5-1

Milwaukee Bucks forward Giannis Antetokounmpo (34) knocks a rebound away from Toronto Raptors guard Norman Powell (24) during the first half of an NBA basketball game Wednesday, Jan. 27, 2021, in Tampa, Fla. (AP Photo/Chris O'Meara)
Lowry reaches 10,000-point plateau as a Raptor in 115-108 loss to Milwaukee

Lowry reaches 10,000-point plateau as a Raptor in 115-108 loss to Milwaukee

Dallas Stars right wing Alexander Radulov (47) and defenseman John Klingberg (3) celebrates a goal by Joe Pavelski against the Nashville Predators during the third period an NHL hockey game, Sunday, Jan. 24, 2021 in Dallas. (AP Photo/ Richard W. Rodriguez)
‘Sloppy’ hockey is the name of the game early in NHL season

‘Sloppy’ hockey is the name of the game early in NHL season

Ottawa Senators head coach D.J. Smith instructs his team in the third period of an NHL hockey game against the Colorado Avalanche in Denver on February 11, 2020. THE CANADIAN PRESS/AP, David Zalubowski
With less practice time, NHL morning skates making a comeback in 2021

With less practice time, NHL morning skates making a comeback in 2021

Most Read