February 16, 2019

Wall Street struggles for direction in choppy trading

09 February 2018, 08:35 | Randall Craig

By Tanya Agrawal

By Tanya Agrawal

The up-and-down trading Friday came a day after the market entered its first correction in two years. The yield on benchmark 10-year U.S. Treasuries, the driver of global borrowing costs, was lingering at 2.846 percent, close to Monday's four-year high of 2.885 percent. Although lower than the two-and-a-half-year high of 50.30 points hit on Tuesday, it is still triple than what it was just a week ago.

Wall Street's main indexes fell more than 1 percent in early afternoon trading on Friday, deepening losses in the past week that have put all three main US markets in correction territory.

The see-saw session is a reflection of the trading during this week's sell-off that has wiped off more than 6 percent of the three major indexes and sent the Dow Jones Industrial Average and the S&P 500 into correction territory on Thursday.

More than $2.5 trillion in value has been knocked off S&P 500 shares since then, adding to the sense that the tide may be changing after nine years of nearly constant gains for Wall Street.

Industrials and health care stocks led the fall, with Fisher & Paykel Healthcare Corp Ltd slipping 1.9 pct to an over 2-1/2 month low, while Auckland International Airport Ltd dropped 1.2 pct to a eleven-week low.

The market's gauge of volatility, the CBOE Volatility Index, opened at a relatively high of 32.18 on Friday.

By 12:54 p.m. ET it was down 1.7 percent on the day and 11.1 percent since highs hit on January 26.

The chief cause of the pullback is a rise in US bond yields because of growing expectations that a strong economy will result in higher inflation and an increase in interest rates this year.

FedEx and UPS dropped about 2 percent after the Wall Street Journal reported Inc will be launching its own delivery service. It was up as much as 349 shortly after the opening bell.

Tracking their US counterparts, banks led the decline locally, with the Australian financial index giving up 0.5 percent.

The Nasdaq is down 188.96 points, or 2.6 percent.

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