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US: China worries drive stocks down nearly 3%


[NEW YORK] US stocks lost another nearly three percent Tuesday as new data offered more evidence that China's industrial machine is stalling.

Losses were especially heavy in shares of banks and oil companies, but the selloff also extended to tech giants like Amazon and Apple.

The Dow Jones Industrial Average finished down 469.68 points (2.84 per cent) at 16,058.35.

The broader S&P 500 plunged 58.33 points (2.96 per cent) to 1,913.85, and the Nasdaq Composite gave up 140.40 (2.94 per cent) at 4,636.10.

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Wall Street followed sharp selloffs in Asia and Europe, after China's official purchasing managers' index fell to its lowest level in three years in August, suggesting the manufacturing sector was contracting.

In Indonesia, International Monetary Fund head Christine Lagarde indicated that the institution was likely to again cut its estimate for world growth this year, after trimming it to 3.3 per cent just two months ago.

"The market is in a situation where it can only see reasons to fall. We are adapting to a world where economic growth is going to be slower than believed in recent months, because of the hit from China and the emerging economies," said Gregori Volokhine of Meeschaert Financial Services.

Citigroup and Bank of America led a big fall in banking shares, both sinking about 4.7 per cent.

Dow members ExxonMobil lost 4.2 per cent and Chevron 3.5 per cent as oil prices buckled again under the Chinese data.

Large tech shares also tumbled hard: Apple lost 4.3 per cent, Google 3.3 per cent and Amazon 3.2 per cent.

A solid August for US car sales did not help automakers either: GM lost 2.7 per cent and Ford 1.1 per cent.

Bond prices were mixed. The yield on the 10-year US Treasury slipped to 2.17 per cent from 2.20 per cent Monday while the 30-year was flat at 2.93 per cent. Bond prices and yields move inversely.