CMC Markets Weekly Report

U.S. stocks sold off sharply on Friday, with the Dow erasing all of its gains since the Fed announcement, as uncertainty over the central bank's bond-buying program spooked Wall Street.

U.S. stocks sold off sharply on Friday, with the Dow erasing all of its gains since the Fed announcement, as uncertainty over the central bank's bond-buying program spooked Wall Street.

The Dow Jones Industrial Average plunged more than 180 points, to finish at 15,451.09 or down 1.2 per cent. The S&P500 lost 12.42 points and the Nasdaq Composite dropped 14.66 points to close 1,709.92 and 3,774.73 respectively.

Stocks opened lower after St. Louis Federal Reserve Bank President James Bullard said the central bank could start winding down its $85-billion monthly bond purchase program during its October meeting.

Separately, Bullard said low readings on inflation means that the Fed can be patient on deciding when to scale back its pace of asset purchases.

In commodity markets, oil prices are mixed, with London prices slightly higher despite easing Middle East supply concerns, while New York fell in trade shaped by the end of the October contract. WTI crude for October delivery finished at $US104.67 a barrel in New York, down $US1.72. Brent North Sea crude for November meanwhile gained 46 US cents to stand at $US109.22 a barrel in London deals.

Gold futures slumped following comments from a slate of Federal Reserve officials. Gold for December delivery, the most actively traded contract, on Friday fell $US36.80, or 2.7 per cent, to settle at $US1,332.50 a troy ounce on the Comex division of the New York Mercantile Exchange.

Copper futures settled lower on the London Metal Exchange (LME) after a US Federal Reserve official said the central bank could begin to scale back its vast bond purchasing program next month. At the PM kerb close on Friday, LME three-month copper was down 0.7 per cent at $US7,280 a tonne and Aluminium settled 1.6 per cent lower at $US1,800 a tonne.

The Aussie dollar is fetching 92.25 US cents, 93.29 Yen, 70.41 Euro and 59.05 Pence.

In economic news today, whilst there's no major economic data scheduled for today we can expect Purchasing Manager's Index (PMIs) from China, Europe and the U.S.

No major equities news is expected today.

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