Altogether, the global stock markets lost $2.3 trillion in market cap in the first four days of 2016, according Michael Hartnett, chief investment strategist at Bank of America Merrill Lynch.
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The Dow Jones Industrial Average was down 2.3% at 16,514 points, marking a low more than 10% under its 52-week intraday high.
S&P 500 e-minis were down 45.25 points, or 2.28 percent, with 507,660 contracts traded.
And there could be more turbulence ahead as history indicates that the trading in the first week of a new year could influence the direction of the market for the remaining 51 weeks.
Less than half an hour after the opening, Chinese stock markets were suspended for the rest of the day as a new circuit-breaking mechanism was tripped for the second time this week.
The government said the USA added 292,000 jobs in December, easily beating expectations.
Wall Street stocks ended lower on Friday (Jan 8) despite signs of stability in Chinese equities and a strong U.S. jobs report, concluding a gloomy first week of 2016 on a negative note. “And crude oil plummeted to a new 12-year low, falling through the levels hit during the 2008 financial crisis”.
The DAX, Germany’s benchmark stock index, is off 7% for the year already and France’s CAC 40 is down 5%.
Worldwide tensions, plunging oil prices and a deteriorating junk bond market are all contributing factors causing market tremors.
Market analysts have been saying that stocks around the globe had become severely “oversold” due to the intense selling to start the new year.
Trading in China was stopped for the second time this week after circuit breakers of the Shanghai Composite Index were triggered 29 minutes into the session when the its fall reached 7%. It also raises the risk of a “currency war” breaking out between China and its neighbors. That decline was touched off by worries that a dive in China’s stock market would harm that nation’s economy.
It is also being interpreted as an indication that consumer demand in China may be slowing more sharply than feared.
Hong Kong’s Hang Seng market, which isn’t subject to the closure of mainland markets following another 7 per cent tumble in the CSI 300, has declined as much as 3.1 per cent to its lowest since July 2013.
The most active gold contract for February delivery rose 15.9 dollars, or 1.46 percent, to settle at 1,107.80 dollars per ounce.
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Shares of Qorvo, were down 5 percent at $43.35, a day after the Apple supplier cut its revenue estimate for the third quarter.
