US stocks end with big losses

Dow suffers its worst one-day point drop in five months

US stocks ended with big losses on Tuesday, 10 March 2015. The Dow Jones Industrial Average suffered its worst one-day point drop in five months as investors began pricing in a rate hike by the Federal Reserve by the middle of the year, while other central banks are embarking on a quantitative easing path.

The Dow Jones Industrial Average dropped 332.8 points, or 1.9%, to 17,662.9. The Nasdaq Composite ended the day down 82.6 points, or 1.7%, at 4,859.8. The S&P 500 closed 35.26 points, or 1.7%, lower at 2,044.2.

All ten sectors ended in the red. Tuesday's free fall erased 2015 gains for the S&P 500 and Dow industrials, pushing the indexes slightly negative for the year.

ECB's bond purchases sent European government bond yields sharply lower, while euro fell to multiyear lows against the dollar, wreaking havoc on foreign exchange and commodity markets.

The continued greenback strength fueled concerns about the earnings prospects of multinational companies while also putting pressure on overseas entities that conduct their dealings in dollars.

The surging dollar hammered commodities, while investors piled into Treasurys, sending yields on the 10-year note down sinking seven basis points to 2.12%.

Shares of Apple fell 2.1% a day after the company revealed its new wearable Apple Watch.

The sell-off in the U.S. stock market did mitigate some of the selling pressure in the gold market on Tuesday, as it was a keener risk-off day in the market place.

The Euro currency was sharply lower and hit an 11-year low on Tuesday. The Japanese yen hit a seven-year low against the U.S. dollar. The surging greenback has been a major bearish factor for most raw commodity markets, which are priced in U.S. dollars on the world markets.

European bond yields are hovering at or near record lows this week, as the European Central Bank's big bond-buying program (quantitative easing, or QE) kicks in. Many look for the Euro currency to fall to parity with the U.S. dollar in the not-too-distant future.

Gold prices ended the U.S. day session moderately lower on Tuesday, 10 March 2015 and hit a 3.5-month low. Sharp gains in the U.S. dollar index, which hit a 12-year high, and lower crude oil prices were bearish outside market forces working against the precious metals on Tuesday.

Gold for April delivery lost $6.40, or 0.6%, to settle at $1,160.10 an ounce on Comex. May silver also fell 14.3 cents, or 0.9%, to end at $15.633 an ounce.

A surging U.S. dollar pushed oil prices at Nymex on Tuesday, 10 March 2015 to their lowest settlement for the month of March, ahead of data that are expected to show a ninth straight weekly rise in U.S. crude supplies. On the New York Mercantile Exchange, crude for delivery in April settled at $48.29 a barrel, down $1.71, or 3.4%.

In a monthly report Tuesday, the EIA lowered its 2015 and 2016 forecasts for West Texas Intermediate crude-oil prices.

Today's participation was ahead of recent averages with more than 830 million shares changing hands at the NYSE floor.

Economic data was limited to Wholesale Inventories and Job Opening Survey. Wholesale inventories increased 0.3% in January after a downward revision revealed no change (from +0.1%) in December The consensus expected a decline of 0.1%. Surprisingly, the sharp drop in petroleum prices did not lead to a large decline in petroleum inventories. These inventories only declined 1.1% in January after declining 7.2% in December. Altogether, nondurable goods inventories declined a modest 0.1% in January. The January Job Openings and Labor Turnover Survey showed that job openings increased to 4.998 million from 4.877 million.

Tomorrow, the weekly MBA Mortgage Index will be released at 7:00 ET while the Treasury Budget for February (consensus -$192 billion) will cross the wires at 14:00 ET.

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