DOW PLUNGES 531 POINTS – Panic-Like Selling Hits Markets
Dow and Nasdaq plunge 3%
Dow down 531 points on Friday.
U.S. stocks closed deep in the red on Friday as global growth concerns accelerated selling pressure to push the Dow and Nasdaq into correction territory. ( Tweet This )
The major averages had their biggest trade volume day of the year and posted their worst week in four years.
The Dow Jones industrial average closed at session lows, off nearly 531 points and in correction territory for the first time since 2011 as all blue chips declined. The last time the index closed more than 500 points lower was on Aug. 10, 2011. In the last five years, the index has only had four instances with closing losses of more than 400 points.
“For investors the momentum and the drive of the market is now lower (than) it used to be because there’s no place to hide,” said Lance Roberts, general partner at STA Wealth Management. “Every time we hit the major technical points we kept selling.”
Market Watch reported:
Investors may be finally showing some signs of panic on Friday, which contrarians might see as a bullish sign, as the 375-point tumble in the Dow Jones Industrial Average DJIA, -3.12% has helped boost the NYSE’s Arms Index above the oversold threshold level of 2.00.
The Arms, or TRIN, which is a volume-weighted measurement of market breadth, climbed to 2.111 in afternoon trade. The Arms tends to rise above 1.0 during broad market declines, as the ratio of volume in declining stocks relative to advancing stocks tends to be higher than the ratio of the number of declining stocks relative to advancing stocks. Many believe an Arms reading above 2.0 implies panic-like selling, or capitulation by bulls, that suggests selling may have been exhausted.