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Dow plummets 800 points on worsening global recession fears

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Via Fox Business

Stocks and oil prices plummeted Wednesday, with the Dow Jones Industrial tumbling 800 points — the fourth largest daily point drop on record and the worst this year — as increasing global recession fears drove Wall Street investors to the safety of U.S. government debt.

The yield, or interest rate, of the Treasury’s 2-year note exceeded the yield on the 10-year Treasury, an ominous signal, known as an inverted yield curve, that a recession is on the way.

Feeding fears of a global recession was a report that Chinese industrial production was climbing at its weakest rate in 17 years and Germany’s economy — Europe’s strongest — was actually shrinking.

Ticker Security Last Change %Chg
I:DJI DOW JONES AVERAGES 25479.42 -800.49 -3.05%
SP500 S&P 500 2840.6 -85.72 -2.93%
I:COMP NASDAQ COMPOSITE INDEX 7773.939028 -242.42 -3.02%

Gold, often seen as a haven for investor assets, settled 0.91 percent at $1,515.90, a 52-week high and the highest level in more than six years.

Oil also tanked on global recession concerns, with the benchmark U.S. crude falling 5 percent to $54.23 per barrel.

Germany’s economy shrank by 0.1 percent in the second quarter from the previous three-month period as global trade conflicts and troubles in the auto industry weighed on Europe’s largest economy.

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The major European markets ended the day drastically lower with the German Dax and French CAC losing more than 2 percent each.

The news was similar in Asia as China’s factory output, retail spending and investment weakened in July, suggesting the world’s second-largest economy faces downward pressure on growth.

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China’s factory output rose 4.8 percent over a year earlier, a marked decline from June’s 6.3 percent. Retail sales growth slowed to 7.6 percent from the previous month’s 9.8 percent.

Japan’s Nikkei added nearly 1 percent, Hong Kong’s Hang Seng inched up less than 0.1 percent and the Shanghai Composite edged up 0.4 percent.

Ticker Security Last Change %Chg
M MACY’S INC. 16.80 -2.56 -13.22%
KSS KOHL’S CORP. 45.11 -5.56 -10.97%
JWN NORDSTROM 26.02 -3.10 -10.65%

Macy’s reported a 48 percent drop in quarterly profit and cut its forecast for full-year adjusted earnings on Wednesday, sending shares tumbling. Rival retailers Kohl’s, Target and Nordstrom also fell.

Technology shares, including Apple, also took a hit. Chipmakers joined the selling.

Ticker Security Last Change %Chg
AAPL APPLE INC. 202.75 -6.22 -2.98%
INTC INTEL CORPORATION 45.87 -0.97 -2.07%
AMD ADVANCED MICRO DEVICES INC. 30.24 -1.87 -5.82%
XLNX XILINX INC. 102.98 -3.45 -3.24%
MU MICRON TECHNOLOGY INC. 42.04 -2.13 -4.82%

Shares of commercial and investment banks were also hammered.

Ticker Security Last Change %Chg
JPM JP MORGAN CHASE & CO. 104.80 -4.54 -4.15%
WFC WELLS FARGO & COMPANY 43.97 -1.99 -4.33%
BAC BANK OF AMERICA CORP. 26.42 -1.30 -4.69%
GS GOLDMAN SACHS GROUP INC. 195.56 -8.55 -4.19%
MS MORGAN STANLEY 39.33 -1.36 -3.34%

On the economic front, the Labor Department said on Wednesday import prices increased 0.2 percent last month as a rebound in the cost of petroleum products offset declines in prices for capital goods and motor vehicles.

The Associated Press contributed to this article


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