Stocks, bond yields drop Washington turmoil rattles markets

The U.S. stock market early Wednesday was on pace to log its worst daily decline in months, as concerns about President Donald Trump's Federal Bureau of Investigation controversy weighed on investor sentiment.

At 9:46 a.m. Central (1446 GMT), the Dow Jones industrial average was down 234.47 points, or 1.12 percent, at 20,745.28, the S&P 500 was down 24.18 points, or 1.01 percent, at 2,376.49 and the Nasdaq Composite index was down 83.65 points, or 1.36 percent, at 6,086.22.

The S&P 500 Index fell 1.8 percent to 2,357.25 at 4 NY, its worst day since September 9.

Financial stocks, which had soared in the months since the election, declined the most as bond yields fell sharply.

That's what was happening Wednesday after news surfaced of a memo from fired FBI Director James Comey alleging President Donald Trump asked him to drop the investigation of former national security advisor Michael Flynn. Japan's Nikkei 225 Index slid by 0.5 percent, while China's Shanghai Composite Index fell by 0.3 percent.

"I would agree with Josh that Mike Pence, if he were to become president - and I said this yesterday - would be a more effective champion of those stimulus measures that would, in fact, help the economy grow further and support the stock market", Insana said.

Australia's S&P/ASX 200 lost 1.21 percent.

Investors piled into assets they perceive as havens, sending gold up 1.8% to $US1259.00 an ounce, and the yield on the benchmark 10-year Treasury note fell to 2.219% from 2.329% on Tuesday.

The steep drop ended an unusually long period of calm for the markets, which had been hovering near all-time highs.

The stock traded 1.9% higher at $US55.58 after rising as high as $US56.97 earlier in the day.

On Wall Street, that idea is been being bandied about increasingly of late, as the commander-in-chief has seen his credibility as leader of the free world assailed relentless over the past weeks, ultimately spurring Wall Street stocks into their worst tailspin in months.

NEW YORK-U.S. stocks fell sharply on Wednesday as investors feared that turmoil in Washington would weigh on the market and Trump administration's reform agenda would be slowed down. The stock traded 1.9 percent higher at US$55.58 as of 1.49pm in NY, after rising as high as US$56.97 earlier in the day. The company, which blamed weak mall traffic, also issued second-quarter guidance that came in lower than analysts' forecasts.

Cypress Semiconductor ( CY ), Integrated Device Technology (IDTI), and Silicon Labs (SLAB) turned in some of the semiconductor sector's worst performances.

In the latest corporate earnings, shares of Target gained after the retailer posted better-than-expected quarterly earnings and offered an upbeat outlook.

MARKETS OVERSEAS: In Europe, Germany's DAX fell 1.4 percent. The 10-year Treasury yield fell to 2.21% from 2.33% late Tuesday, a large move.

  • Leroy Wright