Stock rout goes global after Dow’s worst single-day point drop
President Trump — who made what many White House veterans considered the rookie mistake of repeatedly boasting about the peppy stock market — now owns the largest-ever single-day point plunge for the Dow Jones Industrial Average (and worst percentage drop — 4.1% — for the S&P in more than six years).
- WashPost: With yesterday's loss of 1,175 points, or 4.6% (to 24,345), "Trump has presided over the biggest stock market drop in U.S. history, when measured by points in the Dow."
- "The free fall began in earnest Jan. 30 and snowballed Friday and [yesterday], for a combined loss of almost 2,100 points, or 8 percent of the Dow’s value."
- White House Press Secretary Sarah Sanders: “The President’s focus is on our long-term economic fundamentals, which remain exceptionally strong."
Happening now ... "World stock markets nosedived for a fourth day running [today], having seen $4 trillion wiped off from what just eight days ago had been record high values." (Reuters)
- Signs global rout will go on, per N.Y. Times: "The market sell-off in the United States ricocheted across the world [today] as investors from Tokyo to Hong Kong and London to Frankfurt voted with their feet and futures markets indicated the American stock market could be in for another tough day."
- "The selling was broad, hitting companies of all sizes across industries."
- "Market analysts digesting the numbers from Asia said they did not expect the selling to let up anytime soon."
What you need to know ... "The sharp sell-off ... lacked a specific trigger," per Bloomberg:
- As with a plane crash, "experts are pointing to a confluence of factors, from concerns over the path of Federal Reserve interest-rate increases to a rapid unwinding of trades predicated on continued low volatility in markets."
If you read only 1 thing ... "US economy fundamentally strong despite stock market plunge," per AP:
- "[T]he job market is strong. So is housing. Consumer confidence is solid, and manufacturing is rebounding. Households and businesses are spending freely. Personal debt has lightened since the financial crisis a decade ago. And major economies around the world are growing in tandem."
Be smart ... Axios Business Editor Dan Primack (who noted that he hadn't heard the word "contagion" in a while) emails me: "No one knows anything. Sure, there were contributing factors, like interest rates and the debt limit, and algorithmic trading bits being tripped and falling over each other like dominos."
- But, but, but: "No one really knows why markets have big days in either direction, save for when there is a major external event (terrorist attack, etc.). It's a powerless feeling, bad for cable news punditry."
- "If you claim the rise, you own the fall."