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The Stock Market Is Plunging Again Just Days After a Massive Drop

From TIME - February 8, 2018

(NEW YORK)Stocks are sinking again Thursday, extending a streak of losses that has yanked the market away from record highs. The Dow Jones industrial average slumped more than 400 points. The tumult started last Friday as investors worried about signs of rising inflation.

The market fell steadily as the day wore on and is on track for its fifth loss in the last six days. Technology companies, the leading sector over the past year, and banks fell the most.

The Standard & Poors 500 index, the benchmark for many index funds in 401(k) accounts, is now down 8.1 percent from the latest record high it set January 26. Its still up 15 percent over the past year.

Stock trading turned volatile over the last several days, breaking an unusually long period of calm. European markets were also lower after the Bank of England said it could raise interest rates in the coming months.

After huge gains in the first weeks of this year, stocks tumbled Friday after the Labor Department said workers wages grew at a fast rate in January. Thats good for the economy, but investors worried it will hurt corporate profits and that rising wages are a sign of faster inflation. It could prompt the Federal Reserve to raise interest rates at a faster pace, which would act as a brake on the economy.

Far and away the most important things are the fear that the Fed is going to make a mistake, and higher wages are going to cut into margins, said Scott Wren, senior global equity strategist for Wells Fargo Investment Institute. The worry, he said, is that the Fed will raise interest rates too quickly.

The S&P 500 shed 40 points, or 1.5 percent, to 2,641 as of 1:45 p.m. Eastern time.

The Dow Jones industrial average lost 446 points, or 1.8 percent, to 24,447. Boeing and Caterpillar took some of the worst losses. The Nasdaq composite fell 114 points, or 1.6 percent, to 6,937.

The losses were broad. Four stocks fell for every one that rose on the New York Stock Exchange, and 10 out of the 11 industry sectors in the S&P 500 index were down.

Bond prices wobbled and turned lower. The yield on the 10-year Treasury note rose to 2.85 percent from 2.84 percent.

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