Fear is once again gripping U.S. markets — and crude oil and China remain the major culprits.
The Dow dropped over 400 points shortly after Friday’s opening bell, leaving it on track for the worst day of what has already been a terrible 2016. The S&P 500 fell 2.2%, while the Nasdaq slumped 2.5%.
The wave of selling dashes hopes that recent signs of stability in the market signified Wall Street’s panic attack was over. On Thursday, the Dow jumped 228 points, its best day since early December.
“The sentiment is dominated by fear. Ahead of a long weekend, no one wants to be exposed,” said Sam Stovall, managing director of U.S. equity strategy at S&P Capital IQ.
Stocks are now flirting with critical levels. The S&P 500 is nearing the 1,867.01 level it plummeted to during the market mayhem last August. The index fell as low as 1,878 on Friday.
The Nasdaq is also in jeopardy of closing at its lowest level since October 2014.
“There’s a mad rush for the exits! There is one direction to this trade in the immediate term: Lower,” said Peter Kenny, an independent market strategist and founder of Kenny’s Commentary.
Friday’s market slide was fueled by the crash in crude oil prices and China’s stock market tumbling into a bear market.