US STOCKS-Wall St slides on global growth concerns, Fed view
By Rodrigo Campos
NEW YORK Oct 9 (Reuters) - U.S. stocks slid on Thursday, erasing the previous session's sharp rally, on lingering concern about the strength of the global economy and after a Federal Reserve official said market views on rate hikes are at odds with the central bank's.
German exports slumped by 5.8 percent in August, the biggest drop since January 2009, following data earlier this week that showed industrial orders and output suffered their steepest drops in more than five years.
St. Louis Federal Reserve Bank President James Bullard said the disconnect between the market's view on the Fed's rate hike path and its own view is concerning.
"The markets are making a mistake," said Bullard, a non-voting member of the FOMC who is however seen by investors as a bellwether among Fed officials.
Views that the Fed was more dovish, and rates would remain low longer than anticipated, were behind the market's sharp rally on Wednesday.
"Investors have been conditioned to buy the dip but Fed policy is in transition," said Quincy Krosby, market strategist at Prudential Financial in Newark, New Jersey.
She said the data out of Germany was especially important for large caps, and earnings and fourth-quarter forecasts will be key to determining the medium-term market direction.
"Investors want to be convinced by companies that share prices are commensurate with growth," she said. Continuación...