Stocks lose momentum a day after Dow's record gain

Stocks were falling sharply Thursday at midafternoon, making the prior day's strong performance seem like an aberration, as Wall Street stumbles towards what could be its worst December since the Great Depression.

The Dow Jones Industrial Average slumped 600 points in afternoon trading Thursday. If that holds it would be the Dow's fifth loss of 500 or more points out of 18 trading days in December.

Technology companies and health care stocks, big gainers on Wednesday when the market had its best day in 10 years, took some of the heaviest losses in Thursday's broad slide. Energy companies as well as internet and social media companies fell sharply as well. As of 2:15 p.m., only five stocks in the S&P 500 were higher.

Volatility has been the norm this month. The market remains on track for its worst December since 1931, during the depths of the Depression, and could finish 2018 with its biggest losses in a decade. Even with Wednesday's big gains, the Dow, S&P 500 and Nasdaq are all down more than 12 per cent for the month.

"You're watching the market wrestle with, 'Okay, are we within a couple per cent off the bottom, or does the community think there's another 20 per cent lower?'" said Billy Huzar, client investment strategist at J.P. Morgan Private Bank.

The S&P 500 index fell 69 points, or 2.8 per cent, to 2,398 as of 2:15 p.m. Eastern Time. The Dow slid 585 points, or 2.6 per cent, to 22,292. Both indexes rose about five per cent Wednesday, when the Dow had its biggest-ever single-day point gain.

The tech-heavy Nasdaq lost 214 points, or 3.3 per cent, to 6,340. The Russell 2000 index of smaller-company stocks gave up 36 points, or 2.8 per cent, 1,293.

The partial government shutdown that began over the weekend has weighed on the market. Investors have also been unnerved by the personnel turmoil inside the Trump administration, trade tensions with China, the slowing global economy and worries that corporate profits are going to slip sooner or later.

Technology companies, a big driver of the market's gains before the October downturn, slumped Thursday. Advanced Micro Devices lost 7.5 per cent to US$16.55.

Perrigo gave up 6.6 per cent to US$38, one of the big decliners in the health care sector.

Retailers, which rallied Wednesday on data showing holiday retail sales growth hit a six-year high, helped pull the market lower Thursday. Amazon slid 5.2 per cent to US$1,395.

Bank stocks fell along with Treasury yields, which affect interest rates on mortgages and other loans. KeyCorp declined 3.9 per cent to US$14.13 as the yield on the 10-year Treasury fell to 2.73 per cent from 2.79 per cent late Wednesday.

The decline in oil prices weighed on energy stocks. Noble Energy slid 5.1 per cent to US$18.10.

Benchmark U.S. crude dropped 2.6 per cent to US$45.04 a barrel in New York. Brent crude, used to price international oils, was down 2.6 per cent to US$53.34 a barrel in London.

The dollar fell to 110.53 yen from 111.36 yen on Wednesday. The euro strengthened to US$1.1444 from US$1.1351.

Gold edged up 0.6 per cent to US$1,281.10 an ounce and silver gained 1.2 per cent to US$15.31 an ounce. Copper fell 1.2 per cent to US$2.67 a pound.

The slide in U.S. markets followed a sell-off in major indexes in Europe.

In European markets, where trading resumed after a Christmas holiday break, the German DAX slid 2.4 per cent, while France's CAC 40 gave up 0.6 per cent. Britain's FTSE 100 fell 1.5 per cent.

In Asian markets, the Nikkei 225 index rebounded 3.9 per cent, while South Korea's Kospi was little changed. The Hang Seng index fell 0.7 per cent and Australia's S&P-ASX 200 jumped 1.9 per cent. Stocks climbed in Taiwan and throughout Southeast Asia.

- AP