Finance Finance News Turkish currency woes sink Wall Street and global markets

Turkish currency woes sink Wall Street and global markets

Turkish currency
Wall Street's largest banks fell over concerns about the plunging Turkish lira. Photo: Getty
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Global markets fell overnight as market jitters arising from the plunge of Turkish currency continued to spread.

The Turkish lira has dropped by more than 40 per cent against the US greenback since the start of this year.

On Wall Street, nearly every sector posted losses, but US financial stocks – like their European counterparts – bore the brunt of the concerns over Turkey.

The VIX volatility index, which measures anxiety in the market, shot up 12.3 per cent to almost 14.78 points, its highest level in over a month.

Shares in the big banks Citigroup, Bank of America and JP Morgan lost between 1.5 and 2.4 per cent.

The Dow Jones index fell 125 points, or 0.5 per cent, to 25,188.

The S&P 500 lost 0.4 per cent and the Nasdaq slipped by 0.25 per cent.

Technology and “FANG” stocks — the digital giant cohort of Facebook, Apple, Netflix and Google — defied the trend, with Apple and Amazon gaining more than 0.5 per cent each.

Motorcycle maker Harley-Davidson dipped 4.3 percent after US President Donald Trump tweeted support for a boycott against the company.

Tesla shares rose 0.3 per cent after its chief executive Elon Musk said he was in discussion with Saudi Arabia’s sovereign wealth fund and other potential backers of his plan to take the electric car maker private.

However, Mr Musk said financing was not yet nailed down.

Australian dollar continues to slide

In currencies, the Australian dollar continued to sink to 72.7 US cents, a fresh 18-month low.

It’s also fallen to just under 57 British pence, 63.7 Euro cents and 80.5 Japanese yen.

The US greenback jumped to its highest level in more than a year, which sent the price of gold, crude oil and iron ore tumbling.

In local economic news, NAB will release the results of its July business confidence survey.

The companies reporting their full-year results today include Domino’s, Whitehaven Coal and Cochlear.