Wall St traders dump Boeing, bank stocks

NEW YORK (AFP) - Wall Street traders dumped stocks of major banks and aeroplane manufacturer Boeing on Thursday as the global markets selloff persisted.

But the US markets finished well off their lows, having given up more than 2 per cent at one point during the day, following even steeper losses in Europe and Asia.

The Dow Jones Industrial Average finished down 254.56 points (1.6 per cent) at 15,660.18.

The S&P 500 lost 22.78 (1.23 per cent) at 1,829.08, while the Nasdaq Composite gave up 16.76 (0.39 per cent) to 4,266.84.

Boeing shares lost 6.8 per cent on news the company was under investigation over accounting manoeuvres that might have exaggerated its profitability outlook.

A source close to the matter confirmed to AFP that the Securities and Exchange Commission had opened a probe on Boeing's profitability forecasts for the long-haul 787 and 747 jetliners.

Banks, their profits under threat from a falling interest rate environment and worries of deteriorating credit quality, were also hit with selling.

Bank of America lost 6.8 per cent, Citigroup 6.5 per cent, JPMorgan Chase 4.4 per cent and Goldman Sachs 4.4 per cent.

"Overall, the mood remains very negative and, as investors position ahead of a three-day weekend, it's hard to find many signs of positivity or bullishness," said David Levy of Republic Wealth Advisers.

Levy said investors feared that Federal Reserve Chair Janet Yellen, who over two days of testimony in Congress gave little hint on plans to raise interest rates this year, might not be able to alleviate the worries hanging over the US and global economies.

"There continues to be a mismatch of what market expectations are for future interest rates and what the Fed can say," he said.

The oil and gas industry were pummelled by another fall in crude prices; the West Texas Intermediate crude benchmark dived another 4.5 per cent to US$26.21 a barrel, its lowest close in nearly 13 years.

Oil service giants Halliburton and Baker Hughes fell 2.7 per cent and 4.2 per cent, respectively.

But tech stocks got a lift from Cisco's 9.6 per cent gain, on a better-than-expected quarterly report and a US$15 billion (S$20 billion) boost to its share buyback programme.

Also helping was a 9.6 per cent rise at online travel booker Expedia, and a 12.4 per cent gain by rival TripAdvisor, both of which delivered strong outlooks for the coming year, saying cheaper air fares were boosting tourism.