United States stocks rally as Turkish lira rebounds from record low - USA


US stock indexes slid on Wednesday in a broad decline over concerns of a strengthening dollar, Turkey's currency crisis and United States' trade relations with its partners.

The Dow Jones Industrial Average .DJI fell 137.51 points, or 0.54 percent, to 25,162.41, the S&P 500 .SPX lost 21.59 points, or 0.76 percent, to 2,818.37 and the Nasdaq Composite .IXIC dropped 96.78 points, or 1.23 percent, to 7,774.12. The Nasdaq Composite dropped 60.88 points, or 0.77 per cent, to 7,810.02 at the opening bell.

The Turkish lira stabilized as officials from Turkey and the USA said the countries are in talks to ease diplomatic tensions which have resulted in high tariffs on Turkish steel and aluminum.

The S&P 500 energy index .SPNY dropped 3.5 percent as a fall in crude prices was exacerbated by an unexpected surge in USA stockpiles.

The KBW bank index.BKX gained 1.02 percent, bouncing back from a 3 percent loss raked in over three sessions as investors fretted about banks' exposure to Turkey.

USA stocks dropped on Monday as global jitters from Turkey's plummeting currency spread to Wall Street, with the S&P 500 and the Dow falling for the fourth session in a row.

Retail shares fell as Macy's Inc stock tumbled 15.9 percent after margin fears spooked investors, overshadowing its stronger-than-expected sales and earnings.

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The report from Home Depot, a member of Dow Jones Industrial Average, sent the shares of smaller rival Lowe's higher by 1.6 percent. Erdogan has accumulated more and more control over Turkey's financial system and does not want the central bank to raise interest rates — though independent economists say that's needed to support the currency. But those jitters eased somewhat later Tuesday.

CONTAGION FEARS: Emerging markets had fallen Monday on concern that Turkey's turmoil could highlight similar problems in their economies.

Also lifting the sector was shares of Nvidia (NVDA.O), which gained 1.6 percent after the company rolled out its newest generation of chip technology. Factory output rose 6 percent over a year earlier, in line with the previous month but below forecasts.

"The real question that comes up is if this is a start of a bear market or is this another correction in normal volatility that we're experiencing this year", said Jason Browne, chief investment strategist at FundX in San Francisco, California. The company said its board will review the offer. The German DAX is losing 79.12 points or 0.66 percent, the U.K. FTSE 100 Index is declining 44.20 points or 0.58 percent.

Intel slid 0.5 percent after disclosing three more possible flaws in some of its microprocessors. Hong Kong's Hang Seng retreated 1.5 percent to 27,936.57 and Seoul's Kospi was 1.5 percent lower at 2,248.45.

The dollar rose to 111.22 yen from 110.69 yen. Brent crude lost 7 cents to $72.74 in London. The euro fell to $1.1382 from $1.1411.