US stocks brace for nasty day

China allowed the biggest fall in the yuan in five months, and Shanghai stocks slid 7.3 percent to trigger the second trading halt this week.

Trading in Chinese stocks was suspended Thursday for a second day this week after a dramatic plunge that sent shocks through global markets.

Investors have been jittery as markets got off to their worst four-day start to a year and economists slashed fourth-quarter USA growth estimates.

The price of USA crude oil plummeted to its lowest level in almost 12 years because of worries that the slowdown in China will translate into lower demand for energy.

Shares on the New York Stock Exchange took another tremendous beating on Wall Street Thursday – its third in the last four days of trading – as the Dow tumbled almost 400 points as economic volatility continues in China.

European shares sank more than 3% on those global economic fears, and early this morning, the Dow Jones industrial average fell more than 220 points at the open – after slipping more than 252 points on Wednesday and 276 points on Monday.

The S&P 500 dropped 21 points, or 1.1 per cent, closing at 1922 and down 6 per cent for the week, its worst opening five-day stretch for the index ever, wider than the 5.32 per cent loss in 2008. Apple slid 4.2 percent, Amazon 3.9 percent, Facebook 4.9 percent and Google parent Alphabet 2.3 percent. Yet Chinese stocks rebounded more than 19% for the remainder of the year while USA stocks climbed 7%. The Dow average is down 9.8 percent from its peak in May, and the S&P 500 index has lost 8.8 percent since then. The Nasdaq, down over 6% in 2016, is off to its bleakest start since 2000.

The price of gold and silver both rose more than 1 percent, with gold at $1,103.90 an ounce and silver at $14.16 an ounce. In December the Fed raised rates for the first time in nine years, but interest rates are still very low.

Data showed nonfarm payrolls surged in December and unemployment rate held steady at 5 percent.

Analysts expect the markets to stabilize following intervention from China’s government. Oil for February delivery ended with a loss of 70 cents, or 2.1%, to close at $33.27 per barrel.

The global panic attack is being fueled by fears about China and the intensifying plunge in crude oil prices.

But he also cautioned that “the unknown quantities surrounding what now happens in the Middle East – and the threat of further volatility for China – will keep many investors on edge”.

The Chinese stock market crashed, dropping 7 percent and prompting a freeze in the first half hour of trading.

Hong Kong’s Hang Seng rose 0.6 percent and South Korea’s Kospi added 0.7 percent.

CURRENCIES, BONDS: The Euro fell to $1.0879 from $1.0927 and the dollar rose to 118.17 yen from 117.50 yen late Thursday.