The Dow plunged more than 800 points Wednesday, its worst drop in eight months. Rising bond yields have been drawing investors out of the stock market. The best-performing stocks over the past year took some of the biggest losses.
Growing concerns about the impact of higher borrowing costs on corporate earnings and consumer spending prompted investors to dump shares.
“Fear is rising,” says David Kotok, chief investment officer at Cumberland Advisors in Sarasota, Florida. “Investors are getting a wake-up call.”
Kotok went as far as to predict that a full-fledged market “correction,” or drop of 10 percent, is underway. After its drop of more than 3 percent Wednesday, the broad U.S. market, as measured by the Standard & Poor’s 500, is now 4.9 percent off its Sept. 20 record high.
Read the full article at USA Today.