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Monday, Dec 05, 2022

Wall Street tumbles on recession fears

In one sign of the broad gloom,FedEx Corp fell 9 per cent to $66.31 after the world’s No. 2 package delivery company pared its outlook for the full year.

US stocks dived more than 3 per cent in early afternoon trade on Thursday,extending losses for a fourth day,as a bleak outlook from the Federal Reserve and weak data from China heightened fears of a global recession.

In one sign of the broad gloom,FedEx Corp fell 9 per cent to $66.31 after the world’s No. 2 package delivery company pared its outlook for the full year. FedEx’s fortunes are often viewed as a stand-in for the wider economy’s health.

The market’s dramatic selloff marked the worst performance in more than month after the previous session’s drop,which was sparked by the Fed’s statement citing significant downside risks facing the economy. The word ‘significant’ proved to be significant,said Stephen Wood,chief investment strategist at Russell Investments in New York. This seems like an indiscriminate risk-off environment,where sectors and specific securities and research don’t count for as much … investors are jettisoning risk as the outlook gets cloudier.

In addition to the statement on Wednesday,the US central bank detailed additional stimulus measures to help push down long-term rates. Investors worried the latest plan would have little effect on lending and that there appeared to be few solutions to sluggish worldwide demand.

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The Dow Jones industrial average was down 388.18 points,or 3.49 per cent,at 10,736.66. The Standard & Poor’s 500 Index was down 3.05 per cent,at 1,131.23. The Nasdaq Composite Index was down 2.75 per cent,at 2,468.51. The CBOE Volatility Index,Wall Street’s fear gauge,was up about 10 per cent.

First published on: 23-09-2011 at 12:42:32 am
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