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Dow Jones Industrial Average Ends Volatile Day Down 588; S&P in Correction

The Volatility Alarm That Hasn't Sounded In 13 Years

Aug 24, 2015 at 4:27 PM
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The Dow Jones Industrial Average (DJIA) crashed by more than 1,000 points in early trading -- its biggest intraday swing in history -- putting it in territory not explored since February 2014, sparked by fears of Chinese contagion. While the bellwether finished off its lows, it couldn't avoid a fourth straight triple-digit loss, wrapping up its worst three-day stretch ever. On a percentage basis, though, the broader S&P 500 Index (SPX) was even worse off, suffering its third consecutive loss of more than 2% for the first time in 13 years -- which could beget more volatility -- and falling into correction territory. Meanwhile, the CBOE Volatility Index (VIX) jumped above 50 for the first time since early 2009, conjuring memories of 1987, for some.

 

Continue reading for more on today's market, including:

 

 

The Dow Jones Industrial Average (DJIA - 15,871.28) spent the entire day in the red, striking an annual low of 15,370.33, and ending on a loss of 588.5 points, or 3.6%. It was the third straight session in which not a single Dow component ended higher. Instead, JPMorgan Chase & Co. (NYSE:JPM) led a group of 30 losers lower, diving 5.3% -- and to a fresh annual bottom.

The S&P 500 Index (SPX - 1,893.21) flirted with a triple-digit drop, before ending on a deficit of 77.7 points, or 3.9% -- putting it in correction territory. The Nasdaq Composite (COMP - 4,526.25) joined the SPX in correction territory, swooning 179.8 points, or 3.8%, to mark its third straight triple-digit drop.

The CBOE Volatility Index (VIX - 40.74) jumped to a six-year high of 53.29, and ended on a gain of 12.7 points, or 45.3%, for its highest close in nearly three years.

 

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5 Items on Our Radar Today:

 

  1. While the Street applauded AAPL CEO Tim Cook's comments about China's economy, the Securities and Exchange Commission (SEC) may not be too pleased. Speculation is already swirling that Cook's private email to CNBC's Jim Cramer -- which was later made public -- may have violated the SEC's Fair Disclosure regulation, especially since Cramer co-manages a portfolio with a long position in AAPL. (MarketWatch)
  2. TGT reached a $2.8 million settlement following charges of hiring discrimination. According to the lawsuit, filed by the U.S. Equal Employment Opportunity Commission, the retailer screened applications on the basis of race and gender, even though the tests weren't job-related. (Associated Press, via ABC News)
  3. Chevron Corporation (NYSE:CVX) and Halliburton Company (NYSE:HAL) touched fresh lows as energy stocks got pummeled.
  4. Despite receiving positive analyst attention, these 3 big-name stocks succumbed to the broad-market pressure.
  5. Short-term bulls bet on this China-based Internet name to bounce back strong by week's end.

 

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Commodities:

 

Crude oil was pressured south by the global stock market sell-off, putting the commodity on track for yet another weekly loss. October-dated futures lost $2.21, or 5.5%, to settle at $38.24 per barrel -- a new 6.5-year low.

 

Gold failed to capitalize on its safe-haven reputation, despite the global equities meltdown and a weaker dollar. At the close, gold for December delivery was off $6, or 0.5%, at $1,153.60 per ounce.

 

 

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