The S&P 500 dropped 2.5 percent, to 2,127.81, and the Nasdaq declined 2.5 percent, to 5,125.91.
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Dollar up against most majors on increased Sept Fed hike bets * Fed’s Rosengren says rate increase may be needed Treasury yields rise to 2-month high * Aussie, kiwi fall as traders unwind carry trades (Adds afternoon usa trading, analyst quote) By Dion Rabouin NEW YORK, Sept 9 (Reuters) – The dollar rose on Friday as remarks by Federal Reserve policymakers helped boost investor expectations of a near-term increase in us interest rates.
“Dovish Fed members getting called up to bat for a hike is putting people on edge”, Yousef Abbasi, a global market strategist at JonesTrading, told Bloomberg News.
Most asset classes spent the day in the red.
Utilities and phone stocks plunged more than 3.4 percent, while real-estate investment trusts tumbled 3.9 percent. Higher Treasury yields boost USA interest rates, which makes the dollar more attractive for investors to hold.
USA stocks sold off on Friday in its worst trading session since Brexit as hawkish comments from Boston Fed President Eric Rosengren suggested that the Federal Reserve could resume raising interest rates soon, turning off the flow of easy money into the market.
The euro edged up 0.1 percent in early Asian trade to $1.1265 EUR=, up 1 percent for the week and moving back toward a two-week high of $1.1328 hit overnight, after the European Central Bank left interest rates unchanged.
Raw-material and energy producers in the S&P/TSX dropped more than 2.5 per cent to weigh most on the index, as all of the 10 industries retreated.
Amid the sell-off, the benchmark index fell by more than 1% in early trading.
Among the biggest drags on the benchmark, AT&T saw its worst drop in more than two years, while Apple, Amazon.com and Exxon Mobil each sank at least 2.2 percent.
Chances of the Fed raising rates at the September meeting climbed to 38 per cent, up 16 percentage points from Wednesday, according to fed funds futures.
The UK and Japan, two markets which have help drive the global bond rally this year, also saw losses. The dollar index, which tracks the US currency against a basket of six currencies, rose 0.35 percent to 95.366.
South Africa’s rand fell the most in more than two weeks against the dollar, leading global currency losses amid lingering political risks and as central banks signaled they are starting to question further monetary easing.
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Gold futures fell for a third day, dropping 0.5 percent to settle at $1,334.50 an ounce in NY.
