However, Asian markets are still struggling, with the main index in Shanghai falling more than 7 percent, and Japan falling 4 percent.
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Santoli adds that the market, which hadn’t had a drop of more than 10 percent in more than four years, was overdue for a correction. Gold and silver also fell. The Nasdaq composite shed 179.79 points, or 3.8 percent, to 4,526.25 points.
Still, there’s no denying that Monday was every investor’s worst nightmare.
China’s volatile stock market closed down again in Tuesday’s session, but other equity markets across Asia and in Europe posted gains before trading in New York began.
That had even presidential candidates sounding off on Monday’s rocky day on Wall Street, from Democratic candidate Bernie Sanders to Republican candidate Donald Trump.
Some analysts took the bullish side and said it showed the market’s resilience.
Buying market pullbacks has been a winning trade for years now, but Monday’s head fake of a rebound may have made a dent on the “buy the dip” mentality. Instead, he views this as a “much needed correction in an ongoing secular bull market”.
François Rochon is the head of wealth-management firm Giverny Capital, which he founded in 1998.
And another thing that makes the stock market fall is people getting out when they see the Dow drop – Overton says if you can wait it out – do so.
No one piece of news has sparked the market’s rout.
The broader market volatility combined with still-tumbling oil prices to drive 18 Oklahoma energy company stocks to new 52-week lows. “There needed to be a bit of blowing off steam”. Currencies fell hard in developing economies – particularly those that rely heavily on the export of commodities and oil, both of which China is a big consumer.
“Believe it or not, the drop the last couple weeks has not driven up calls all that significantly so it appears employees are riding it out”, Mueller said.
“We went three years, two months and 21 days without a 10% correction in the (S&P 500)”, says Don Luskin, market strategist at TrendMacro.
“Even if [their funds] are allocated fairly aggressively, they realize this is a short-term correction they are going through”, he said. “The fundamentals of the U.S. economy remain good, especially compared with everybody else”, Yardeni said. “It took on a crescendo feeling”, Janney’s Luschini said.
The U.S. Federal Reserve has been hinting that it wants to raise interest rates for the first time in nearly a decade, but investors are wondering whether the market turmoil might lead the central bank to put those plans on hold.
Wall Street will get more signals about the state of the U.S economy this week with the release of reports that include new home sales in July, consumer confidence this month and a possible revision of the second-quarter’s estimated economic growth, which previously was pegged at an annual rate of 2.3 percent. “Our brains are wired to panic”, Bilkie said.
U.S. Treasurys surged as investors bought less risky assets.
Perhaps, but it could be a rough ride in the meantime.
I remember vividly an interview back then with John Templeton, one of the greatest investors of all time.
Traders have been putting their money in investments they consider safer, including government bonds and gold. The yield on the benchmark 10-year note fell to 2.01 percent from 2.04 percent.
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Crude oil plunged below $39 a barrel on Monday for the first time since 2009.
