Global markets slump as investors flee for safety

Wall Street stocks followed Europe and Asia lower on Tuesday as investors fled for safety as they worried about US earnings, Italy’s finances and US trade tensions while pressure mounted on Saudi Arabia over the death of journalist Jamal Khashoggi.

Benchmark US Treasury prices rose, sending yields to their lowest levels in almost three weeks as tumbling equity markets worldwide fed investor demand for low-risk debt.

The dollar index fell slightly, and oil prices fell after Saudi Arabia said it could supply more crude quickly if needed, reassuring investors ahead of US sanctions on Iran’s crude exports that start next month. US crude fell 2.64 per cent to $67.53 per barrel and Brent was last at $77.91, down 2.41 per cent on the day.

“People are getting hysterical, taking these little dots and drawing universal trend lines,” said Jack Ablin, chief investment officer at Cresset Wealth Advisors in Chicago, citing worries about a potential global slowdown.

The Dow Jones Industrial Average fell 368.06 points, or 1.45 per cent, to 24,949.35, the S&P 500 lost 45.22 points, or 1.64 per

cent, to 2,710.66 and the Nasdaq Composite dropped 153.49 points, or 2.06 per cent, to 7,315.14. The pan-European STOXX 600 was down 1.6 per cent after hitting its lowest point since December 2016. China’s main stock indexes resumed a downward spiral a day after the bluechip index posted its biggest gain in nearly three years.