Wall Street stocks rally then sink as turbulence continues

It was another shaky day on Wall Street yesterday as indexes rallied in the morning then sank in the last few minutes of trading.

Energy companies dropped along with oil prices and technology companies also declined.

Stocks were coming off a big gain on Tuesday.

At times investors looked ready to jump back in after steep losses on Friday and Monday, yet every gain the market made was met with more selling.

About 20 minutes before the close of trading the Dow Jones industrial average was up more than 260 points, but it finished with a small loss.

After two steep plunges, including its worst loss in six and a half years on Monday, the S&P 500 is down 6.7% from its most recent record high set on January 26.

While markets were noticeably calmer on Wednesday, there are signs that investors are still far more nervous than they were just a few days ago.

The VIX, which is called Wall Street's "fear gauge" because it measures how much volatility investors expect in the future, is currently at 27, more than double where it was two weeks ago. It spiked above 50 early on Tuesday.

"The markets had blinders on," said Invesco Chief Global Markets Strategist Kristina Hooper.

"I thought it was almost alarming that markets weren't considering that, for example, we have a different (Federal Reserve) in 2018 that could be more hawkish."

Stocks tumbled on Friday after the labour department said that workers' wages rose in January at their fastest pace in eight years.

That is good for the economy, but Ms Hooper noted that higher pay to workers can reduce corporate profits, and those profits are the stock market's fuel.

And while higher pay affects company profits quickly, it can take a long time for workers to start spending more money after they get a raise.

The Standard & Poor's 500 index lost 13.48 points, or 0.5%, to 2,681.66. The Dow slid 19.42 points, or 0.1%, to 24,893.35.

The Nasdaq composite fell 63.90 points, or 0.9%, to 7,051.98. Smaller companies fared better than the rest of the market, and more stocks rose than fell on the New York Stock Exchange.

The gap between the Dow's highest and lowest levels on Wednesday was about 500 points, or 2%. That is big, but it is dwarfed by the lurching moves the market made the last few days.

While investors may still be uncertain about where stocks are going, they are not rushing for cover in ultra-safe investments like bonds.

Bond prices fell, sending yields higher. The yield on the 10-year Treasury note, a benchmark for mortgages and other kinds of loans, rose to 2.84% from 2.81%.

Global markets mostly rose and appeared calmer on Wednesday.

Germany's DAX was up 1.6% while the British FTSE 100 index rose 1.9%.

The CAC 40 in France picked up 1.8%. Hong Kong's Hang Seng fell 0.9% while Japan's Nikkei 225 stock average closed up 0.2%. The Kospi in South Korea fell 2.3%.

The biggest technology companies fared the worst. Apple fell 3.49 dollars, or 2.1%, to 159.54 dollars and Facebook lost 5.13 dollars, or 2.8%, to 180.18 dollars.

Alphabet, Google's parent company, lost 29.092 dollars, or 2.7%, to 1,055.41 dollars.

Wynn Resorts jumped 14.10 dollars, or 8.6%, to 177.32 dollars after Steve Wynn resigned as chairman and chief executive.

The Wall Street Journal reported last month that a number of women accused him of sexual harassment or assault, and said he paid 7.5 million dollars to settle one such case.

He has denied the accusations but said he could not be effective in his corporate positions in the face of those allegations. Wynn stock has fallen 11.6% since the Journal's report.

Newspaper publisher Tronc soared 3.45 dollars, or 19.1%, to 21.55 dollars after it agreed to sell the Los Angeles Times and a group of other newspapers to Dr Patrick Soon-Shiong, a major Tronc shareholder and former board member, for 500 million dollars.

Snap, the parent of Snapchat, the disappearing-message application, rose 6.69 dollars, or 47.6%, to 20.75 dollars after it reported strong user growth and greater-than-expected revenue in the fourth quarter.

The stock went public in March and traded above 29 dollars a share shortly after its initial public offering.

- PA

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