AFP, New York :
A heavy selloff on Wall Street Wednesday cut short a two-day rally and smothered hopes of a sustained turnaround on battered global markets.
There was no clear catalyst for the plunge, which saw the Dow Jones Industrial Average of blue chips sink 2.2 percent and the Nasdaq Composite lose 3.4 percent.
The losses came after the weekly US oil stockpiles report showed another surge in fuel stocks, cutting short a rally in crude prices and sending Brent crude below $30 a barrel for the first time since April 2004.
Analysts said the report suggested slow demand growth for energy in the United States, a possible sign of slower economic activity overall.
Supporting that view was the Federal Reserve’s Beige Book survey of regional economic conditions, which was somewhat less buoyant than December’s, though not at all downbeat.
Michael James at Wedbush Securities said the market was reading economic weakness, and not just excess supply, into the weak crude prices.
“Oil is a key determinant of economic strength,” he said. “A majority of traders are using the lack of increased demand for oil as a read-through for global growth in general.”
The US selloff hit all sectors but utilities. Tech shares fell 2.8 percent and biotech 5.4 percent. Amazon sank 5.8 percent and Twitter 4.8 percent.
A heavy selloff on Wall Street Wednesday cut short a two-day rally and smothered hopes of a sustained turnaround on battered global markets.
There was no clear catalyst for the plunge, which saw the Dow Jones Industrial Average of blue chips sink 2.2 percent and the Nasdaq Composite lose 3.4 percent.
The losses came after the weekly US oil stockpiles report showed another surge in fuel stocks, cutting short a rally in crude prices and sending Brent crude below $30 a barrel for the first time since April 2004.
Analysts said the report suggested slow demand growth for energy in the United States, a possible sign of slower economic activity overall.
Supporting that view was the Federal Reserve’s Beige Book survey of regional economic conditions, which was somewhat less buoyant than December’s, though not at all downbeat.
Michael James at Wedbush Securities said the market was reading economic weakness, and not just excess supply, into the weak crude prices.
“Oil is a key determinant of economic strength,” he said. “A majority of traders are using the lack of increased demand for oil as a read-through for global growth in general.”
The US selloff hit all sectors but utilities. Tech shares fell 2.8 percent and biotech 5.4 percent. Amazon sank 5.8 percent and Twitter 4.8 percent.
