New York – US stocks fell sharply in early trade on Thursday as a global selloff accelerated following another plunge in Chinese equities.
About 35 minutes into trade, the Dow Jones Industrial Average stood at 16 677.57, down 228.94 points (1.35%).
The broad-based S&P 500 fell 29.52 (1.48%) to 1 960.74, while the tech-rich Nasdaq Composite Index sank 96.72 (2%) to 4 739.04.
Chinese markets shuttered early for the second time in four sessions after automatic “circuit breakers” aborted trading after equities fell 7%. Chinese officials plan to suspend use of the circuit breakers on Friday, Xinhua news agency reported.
On Thursday, Chinese authorities lowered the yuan currency’s central rate against the US dollar by 0.51% to 6.5646, the lowest since March 2011, spurring worries of deeper cuts ahead.
“There is a lot wrapped up in the enigma that is China right now,” said Briefing.com analyst Patrick O’Hare.
“A foreboding sense of uncertainty about what comes next there has distilled a foreboding sense of uncertainty about what comes next for global equity markets.”
US investors are gearing up for Friday’s December US jobs report. Analysts expect the US economy added 200 000 new positions during the month, down a tick from 211 000 in November.
Commodities-linked stocks fell on worries about the China slowdown. Oil giant Chevron lost 2.5%, metals producer Freeport-McMoRan shed 6.2% and heavy equipment maker Caterpillar lost 2.4%.
US-listed Chinese stocks fell, with Alibaba dropping 5.4%, Weibo 6% and JD.com 4.3%.
Macy’s jumped 3.6% as it unveiled $400m in job cuts and store closures following a disappointing holiday shopping season.
JC Penney, another department store chain, added 2% as it posted a 3.9% increase in comparable store sales in November and December.
Wine and sprits distributor Constellation Brands jumped 5.3% as third-quarter earnings rose 21.7% to $270.5m and it lifted its full-year forecast.
