Stocks plunge as global recession fears rattle investors

Reuters / Brendan McDermid

• Stocks sold off sharply on Wednesday after three central banks around the world made surprising cuts to their interest rates, raising concerns around a broad global slowdown.
• Meanwhile, bond prices soared, pushing the 30-year Treasury yield near all-time lows.
• Investors also piled into safe havens such as gold, which reached a six-year high.
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US stocks got pummeled on Wednesday as three global central banks made surprising cuts to their interest rates, stoking concerns of a broad global slowdown.

The renewed bout of risk aversion also send bond prices soaring, with the 30-year Treasury yield falling close to an all-time low.

Here's a look at the major US indexes as of the 10:55 a.m.:

• The S&P 500 fell 0.47%, to 2,868.14 - down as much as 2%
• The Dow Jones Industrial Average declined 0.88%, to 25,800.26 - down as much as 2.3%
• The Nasdaq Composite slid 0.09% to 7,825.93 - down as much as 1.7%

The losses came after Thailand, India, and New Zealand shocked investors by lowering their benchmark lending rates. Their actions come amid a global currency war that's seen a growing number of nations weaken their currencies. That debasement is often driven by rate cuts, since such easing increases the money supply.

These latest maneuverings follow China's decision earlier this week to let its currency slip below the psychologically significant level of 7 yuan-per-dollar. The move was viewed as an escalation in the already-fraught global trade war, since a weaker currency makes a nation's exports more appealing - and markets wound up turning in the worst day of 2019.

China stabilized its currency on Tuesday which led to a rally in the major US indexes that pared some losses from Monday's sell-off. But investors hadn't counted on other countries getting in on the currency-devaluation trend, hence Wednesday's large losses.

Meanwhile, gold hit a six-year high on as investors sought the relative safety of haven assets.