Wall Street tumbled again on Monday after Britain’s shock vote to leave the European Union, sending major U.S. stock indexes to their worst two-day swoon in about 10 months.
All three main indexes fell at least 1.5 percent in the wake of Thursday’s referendum that has roiled global markets and led investors to seek safe-haven assets.
The Nasdaq dropped more than 2 percent, underperforming the other major indexes, amid fears that fallout from Britain’s decision could hit business investment spending in the technology sector.
Along with tech, materials, financials and energy were the worst-performing sectors.
“The momentum has continued downward because there continues to be a lot of uncertainty,” said Eric Kuby, chief investment officer at North Star Investment Management in Chicago. “It’s important to note that it’s orderly. It doesn’t feel panic-inspired.”
The Dow Jones industrial average fell 260.51 points, or 1.5 percent, to 17,140.24, the S&P 500 lost 36.87 points, or 1.81 percent, to 2,000.54 and the Nasdaq Composite dropped 113.54 points, or 2.41 percent, to 4,594.44.
Eight of the 10 major S&P sectors closed lower. Utilities and telecom services, two high dividend-paying groups, were the only ones to gain.
Since Britain’s referendum, the S&P 500 has fallen 5.3 percent, its worst two-day slide since August 2015.
Friday’s selloff had wiped out $2.08 trillion from global equity markets – the biggest one-day loss ever, according to Standard & Poor’s Dow Jones Indices.
Investor fears of a “Brexit” vote had eased ahead of the referendum, with the S&P 500 closing within about 17 points of its May 2015 record high on Thursday.
“It feels harsh and there’s no question that Friday was harsh, but relative to our peak we’re not that far off,” said Aaron Jett, vice president of global equity research at Bel Air Investment Advisors in Los Angeles. “So there certainly is potential for some more downside” in the short-term.
U.S. Treasury Secretary Jack Lew said he sees no signs of a financial crisis arising from Britain’s decision, although the result does present additional “headwinds” for the U.S. economy.
Banks continued to be among the worst-hit as traders discounted chances the U.S. Federal Reserve will raise interest rates in the near term.
Bank of America, down 6.3 percent, and JPMorgan, off 3.3 percent, were among the biggest drags on the S&P, while the KBW Bank index fell 5.1 percent. Earlier, Europe’s bank stocks tumbled 7.7 percent.
With sterling hitting a 31-year low, the dollar posted sharp gains, dealing a blow to U.S. companies that receive a large portion of sales from overseas.
HeartWare International soared 92.8 percent after Medtronic said it would buy the medical device company for about $1.1 billion.
More than 10.5 billion shares changed hands in U.S. exchanges, well above the roughly 7.3 billion average over the past 20 sessions.
NYSE decliners outnumbered advancers by a 4.25-to-1 ratio; on the Nasdaq, a 5.75-to-1 ratio favoured decliners.
The S&P 500 posted 20 new 52-week highs and 30 new lows; the Nasdaq recorded 14 new highs and 168 new lows.