Related: Trump, Sanders tweet about Dow plunge
In the United States, few stocks were immune — especially not companies that do big business in China. Apple, which closed Friday at $105.76, dipped to $92 on Monday. Yum Brands, which owns KFC, closed at $79.70 on Friday and sank to $71.39 on Monday.
“What’s a company that’s doing business with China actually worth right now?” JJ Kinahan, TD Ameritrade’s chief strategist, told The Associated Press. “When you’re not sure, you tend to sell.”
The gap between the Dow’s highest and lowest points of the day was 1,089 points — a bigger swing than on the most volatile day of the 2008 financial crisis and during the 2010 “flash crash.”
If the market comes back, it could make history, even in percentage terms. Only twice before has the average dropped 6 percent in any day and then recovered to close down less than 3 percent.
One was on Oct. 10, 2008, during the financial crisis, when the Dow plunged 8.1 percent and closed down 1.5 percent. The other was on Oct. 20, 1987, the day after the Black Monday market crash, when the Dow plummeted 7.1 percent and closed up 5.9 percent.
Analysts tried to point out that the fundamentals of the American economy had not changed — steady growth, stable banks and an unemployment rate of 5.3 percent. At the last market correction, in April 2011, unemployment was 9.1 percent.
Seeking to calm the public, Josh Earnest, the White House press secretary, focused on the “resiliency” of the U.S. economy. He said the Treasury Department was keeping a close eye on global markets. “The president is very mindful of how this would be a particularly bad time for a self-inflicted wound,” he said, urging Congress to pass a budget and avoid a government shutdown. One market-watcher, Jim Paulsen, chief investment strategist and economist for Wells Capital Management, said stocks were primed for a sell-off. The S&P 500 tripled from its low in March 2009 to its record high earlier this year. “I’ve been of the view since late last year that this market is in a vulnerable position,” Paulsen told the AP. “It’s gone almost straight up for six years.” This article first appeared on NBCNews.com.Recommended
Erin McClam
See Kit Tang