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US stocks erase most of an early loss as volatility surges

US stocks erase most of an early loss as volatility surges

August 8th, 2019 by the Associated Press in Business

Trader John Romolo works on the floor of the New York Stock Exchange, Wednesday, Aug. 7, 2019. U.S. stocks fell broadly in midday trading Wednesday as central banks around the world cut interest rates and increased fears that global growth is being crimped by the U.S.-China trade war. (AP Photo/Richard Drew)

Stocks overcame a big loss Wednesday on Wall Street, though the market’s recovery left plenty of signs of worry among investors that the fallout from the trade war between the U.S. and China will spread.

A late-afternoon rally lifted most of the major stock indexes out of the red, reversing most of the early slide that briefly pulled the Dow Jones Industrial Average down more than 580 points. Technology and consumer staples stocks powered much of the gains, offsetting losses in banks, energy companies and other sectors.

Even so, the moves in the bond and commodities markets signaled investors are nervous the escalating trade war between the U.S. and China may derail the global economy.

Bond yields sank around the world, something that happens when investors see a weaker economy and low inflation on the way. The price of oil tanked and the price of gold shot up to its highest level in six years as traders sought safe-haven holdings.

The S&P 500 index eked out a gain of 2.21 points, or 0.1 percent, to 2,883.98. The index had been down 2 percent during the heaviest bout of selling.

The Dow dropped 22.45 points, or 0.1 percent, to 26,007.07. It had been down as much as 589 points.

The Nasdaq led the market’s upward swing, climbing 29.56 points, or 0.4 percent, to 7,862.83. The Russell 2000 index of smaller companies lost 1.40 points, or 0.1 percent, to 1,500.69.