NEW YORK — Renewed concerns that central banks will ease off their support for the global economy hit the U.S. stock market Tuesday. NEW YORK — Renewed concerns that central banks will ease off their support for the global economy
NEW YORK — Renewed concerns that central banks will ease off their support for the global economy hit the U.S. stock market Tuesday.
Indexes began sliding from the opening bell. Before U.S. markets opened, Asia and then Europe had already fallen, rattled by the Bank of Japan’s decision not to take new steps to spur growth in the world’s third-largest economy.
The news out of Japan added to questions surrounding global central banks, investors said. U.S. markets have been shaken by speculation that the Federal Reserve will start curtailing its own bond-buying program in the coming months.
“There’s just a lot of uncertainty,” said Dan Greenhaus, chief global strategist at the brokerage BTIG in New York. “People are worried about the Fed. They’re worried about a spike in interest rates. And then Japan says it’s finished for now.”
The Dow Jones industrial average dropped 116.57 points, or 0.8 percent, to 15,122.02. It fell as much as 152 points in the first hour of trading, rose as much as 12 points to 15,251 by midday and then sank in the afternoon.
The Standard & Poor’s 500 index fell 16.68 points, or 1 percent, to close at 1,626.13. All 10 industry groups in the index dropped, led by banks and energy companies.
Earlier, major stock markets in Europe and Asia slumped. Germany’s DAX dropped 1 percent and France’s CAC-40 lost 1.4 percent. Japan’s Nikkei stock index fell 1.5 percent after the Bank of Japan voted on Tuesday to stick to its current bond-buying program, disappointing those who had expected the bank to widen its effort.
The world’s biggest central banks have bought trillions of dollars worth of bonds in recent years, pressing long-term interest rates down in an attempt to encourage borrowing and spending. In the U.S., the Fed buys $85 billion in bonds each month.
