Wall Street is reeling from a worse-than-expected bloodbath this morning, and Australian stocks are expected to follow.
Market snapshot at 7:20am (AEDT):
- ASX SPI 200 futures -1.9pc at 5,851, ASX 200 (Monday's close) -1.6pc at 6,026
- AUD: 79.08 US cents, 56.46 British pence, 63.71 Euro cents, 86.67 Japanese yen, $NZ1.08
- US: Dow Jones -3.7pc at 24,570, S&P 500 -3pc at 2,680, Nasdaq -2.4pc at 7,064
- Europe: FTSE -1.5pc at 7,335, DAX -0.8pc at 12,687, Euro Stoxx 50 -1.3pc at 3,479
- Commodities: Brent crude -1.8pc at $US67.32/barrel, spot gold +0.5pc at $US1,339.31/ounce, iron ore +1.8pc at $US75.70/tonne
What happened on Wall Street?
The Dow Jones index has plunged by 1,068, or 4.2 per cent to 24,453.
Since Friday, the Dow has plunged by more than 1,700 points in two trading days.
US stocks are continuing to be dragged down by a fast rise in interest rates, with US 10-year bond yields reaching a four-year high.
The broader S&P 500 also tumbled 4.2 per cent to 2,646, and the Nasdaq fell 3.6 per cent to 6,981.
Every S&P sector has been smashed, with energy and financials being the worst performers by far.
Energy stocks like Exxon Mobil tumbled after oil prices fell sharply overnight.
Brent crude has fallen to $US67.50 dollars a barrel
The big banks Citigroup, Goldman Sachs and Bank of America have dropped by up to 2.5 per cent each.
But it was Wells Fargo which fell the hardest — falling by 8 per cent, making it the weakest S&P stock.
This was after the Federal Reserve forced Wells Fargo to replace four directors. In addition, the Fed is restricting the bank from getting any larger or richer until its "widespread consumer abuses" are addressed.
Australian market to fall
With ASX futures down by 45 points, the Australian market is expected to fall.
Today is also a big day for local economic news.
The Reserve Bank board will meet today, and most likely keep interest rates on hold at the record low 1.5 per cent.
Also, the Bureau of Statistics will release its latest retail and international trade figures.
The Australian dollar is continuing to feel some pressure.
It fell to 78.9 US cents overnight, but it has since recovered slightly to just over 79 US cents.
However, the local currency has to 56.4 British pence and 63.7 Euro cents.
More to come.
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