U.S. stocks plunged at the open on Friday, with the Dow Jones average falling more than 500 points, after Britain’s vote to quit the European Union delivered the biggest blow to the global financial system since the 2008 financial crisis.
Investors worried about the outlook for the world economy sought refuge in the dollar and other safe-harbor assets such as gold and U.S. Treasury bonds, while dumping riskier shares. The yield on the U.S. 10-year bond hit its lowest since 2012.
Banks and tech stocks were among the biggest losers.
The market was already expected to be volatile as traders adjust portfolios to account for an annual reconstitution of the widely followed Russell stock indexes.
“The participants were caught off guard and it showed a touch of complacency in terms of the vote,” said Ryan Larson, head of U.S. equity trading at RBC Global Asset Management in Chicago. “The mood is one of humility so far this morning, and certainty I think that of caution.”
At 9:33 a.m. ET (1333 GMT) the Dow Jones industrial average .DJI was down 538.21 points, or 2.99 percent, at 17,472.86, the S&P 500 .SPX was down 54.85 points, or 2.6 percent, at 2,058.47 and the Nasdaq Composite .IXIC was down 177.97 points, or 3.62 percent, at 4,732.08. Read more
Categories: Asia Unhedged