According to the ABC News Website, uncertainty over the Trade War between the USA and China as well as the pending US Midterm elections have caused Stock Markets to dive overnight.
“Australian shares are expected to tumble sharply, following reports US President Donald Trump plans to ramp up the trade war with China.
The Australian dollar fell to 70.57 US cents, around its lowest level in two-and-a-half years.
It has also weakened to 55.1 British pence, and 62 Euro cents.
The United States is preparing new tariffs worth $US257 billion ($364 billion) on all remaining Chinese imports that have not already been hit with tariffs.
These additional taxes could be implemented as early as December — if next month’s talks between the two countries’ presidents, Mr Trump and Xi Jingping, fail to resolve the ongoing trade dispute, according to a report from Bloomberg News.
This led to the industrial-skewed Dow Jones index dropping 245 points, or 1 per cent, to 24,443. Earlier in the volatile trading session, optimistic investors drove the Dow sharply higher by 350 points.
The S&P 500 fell 0.7 per cent to 2,641. It has fallen by nearly 10 per cent since its late-September peak, so the benchmark index is almost in correction territory.
Tech stocks lead the slide
Meanwhile, the Nasdaq was hit hardest, down by a steep 1.6 per cent to 7,050. The tech-heavy index has plummeted by 13 per cent since its August peak, and is officially undergoing a market correction.
Global stocks have been heavily sold-off in the last month due to worries about rising US interest rates, a spike in volatility, and stocks — especially in the technology sector — being over-valued.
“These growth stocks just got so over-valued it is only natural to see some air come out of that balloon. That could continue for a while,” said Stephen Massocca, senior vice president at Wedbush Securities in San Francisco.
“But in terms of the rest of the market that doesn’t have those kinds of extreme valuations, I think we are probably pretty close to the end of the decline.”
Investors also may be increasingly nervous about uncertainty surrounding US mid-term elections, now just a week away.
Major technology and growth stocks, including Amazon (-6.3pc), Netflix (-5pc) and Google’s parent company Alphabet (-4.5pc) posted sharp falls.
The S&P 500 technology sector shed 1.8 per cent of its value.
The industrials sector, which is seen as sensitive to trade issues, dropped 1.7 per cent, weighed down by aviation company Boeing (-6.6pc).”
Atricle Credit of ABC News Online: 30/10/2018