Global stocks, oil tumble as China economy concerns mount

Thu Jan 7, 2016 5:16pm EST
 
Email This Article |
Share This Article
  • Facebook
  • LinkedIn
  • Twitter
| Print This Article | Single Page
[-] Text [+]

By Rodrigo Campos

NEW YORK (Reuters) - Shares on major exchanges fell for a sixth straight day on Thursday and crude oil prices touched multi-year lows as investors fretted over the state of China's economy and its ability to stabilize its stock market.

In a move that deepened concerns over China's economic health, the People's Bank of China set the yuan midpoint rate lower for an eighth consecutive day. The 0.5 percent decline was the biggest between daily fixings since August.

China suspended a circuit breaker implemented at the start of 2016 that stopped trading for the day when the benchmark index fell 7 percent, a halt already triggered twice this week. Analysts and investors said the mechanism, put in place to avoid market volatility, may have backfired.

"People see the weakness in China and in the overall equity market and think there's going to be an impact on corporations here in the United States," said Robert Pavlik, chief market strategist at Boston Private Wealth in New York.

Rounding out its worst four-day start to a year in more than a century, the Dow Jones industrial average .DJI fell 392.41 points, or 2.32 percent, to 16,514.1.

The S&P 500 .SPX lost 47.17 points, or 2.37 percent, to 1,943.09 and the Nasdaq Composite .IXIC dropped 146.34 points, or 3.03 percent, to 4,689.43.

A gauge of major stock markets globally .MIWD00000PUS fell 2.2 percent and Nikkei futures NKc1 were down 2.6 percent.

  Continued...

 
An investor looks at an electronic screen showing stock information at a brokerage house in Hangzhou, Zhejiang province, January 7, 2016. REUTERS/Stringer