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Stocks shudder as economic jitters take center stage

Traders work on the floor of the New

Traders work on the floor of the New York Stock Exchange as Janet Yellen, chair of the U.S. Federal Reserve, is seen speaking on a television screen in Manhattan on Thursday, Feb. 11, 2016. Credit: Bloomberg / Michael Nagle

Jitters over the global economy and a steep drop in crude oil knocked U.S. stocks lower for the fourth day in a row Thursday.

While stocks ended lower, they recovered somewhat from far steeper losses earlier in the day. The Dow Jones industrial average dropped 254.56 points, or 1.6 percent, to 15,660.18. The average had been down as much as 411 points.

Shares of the largest publicly traded companies headquartered on Long Island also fell. The Newsday Long Island Bloomberg Index slid 0.4 percent on Thursday to 265.44, adding to a decline that has trimmed 6.7 percent from the index since the beginning of the year.

Leading the index down was Melville-based Verint Systems Inc., a maker of software used by call centers and security agencies, which tumbled 4.3 percent to $30.43.

The drop in the U.S. followed large losses all around the world, and left all three major U.S. indexes down at least 10 percent since the beginning of the year.

The latest slump reflected heightened concerns that global economic growth is slowing, even as Federal Reserve Chair Janet Yellen reiterated her confidence in the U.S. economy in testimony to congress Thursday.

“A lot of people are having trouble assessing the true value of stocks,” said J.J. Kinahan, TD Ameritrade’s chief strategist. “What it says to me is we’re going to continue with volatility.”

Financial companies were among the biggest decliners amid growing anxiety that interest rates in the U.S. and elsewhere would remain low and sap bank profits.

The price of oil tumbled to $26.21, its lowest level since May 2003. Investors fled to the traditional havens of bonds and precious metals. Gold jumped 4.5 percent.

The Standard & Poor’s 500 lost 22.78 points, or 1.2 percent, to 1,829.08. The Nasdaq composite fell 16.76 points, or 0.4 percent, to 4,266.84.

Investors have become increasingly worried that the mounting market turmoil could put a brake on the global economy at a time it is already struggling with a litany of issues, including China’s slowdown, low inflation and plunging energy markets.

Benchmark U.S. crude oil fell for the sixth day in a row, sliding $1.24, or 4.5 percent, to $26.21 a barrel in New York. Brent crude, a benchmark for international oils, dropped 78 cents, or 2.5 percent, to $30.06 a barrel in London. Natural gas fell 5 cents, or 2.5 percent, to $1.99 per 1,000 cubic feet.

with Ken Schachter


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