Dow turns 567 point loss into 567 point gain as stocks rally

Trump has, repeatedly, taken credit for each and every rise in the stock market since coming into office last January.

Elsewhere in Asia on Wednesday, Australia's S&P/ASX 200 ended up 0.8% while South Korea's Kospi index dropped 2.3%.

"If the market is going to react to that kind of news, it's generally when it is broken", Federick said.

"What we have seen is perhaps the greatest sign of real health in markets for a long time", Bateman said. Focusing on any one day - or even one week - of stock market performance is akin to standing six inches away from a picture and trying to define what is depicted.

With hope for a market rebound, traders began to sell off, especially after Wall Street opened with a drop of 547 points or 2.25 percent, but soon clawed back to be up 1.4 percent within hours.

"We've seen that optimism in small businesses, we've seen that optimism with investors and consumers - maybe too much so".

It was the Dow Jones industrials' biggest loss in absolute points in history and the biggest percentage drop since 2011.

On Monday, both the S&P 500 and the Dow lost over 4 percent their biggest falls since August 2011, as fears of rising USA interest rates and government bond yields reached record-high valuations of stocks.

The benchmark S&P/ASX200 index fell 95.2 points, or 1.56 per cent, to 6026.2 points while the broader All Ordinaries index tumbled 101.4 points, or 1.63 per cent, to 6128.4 points.

European shares closed down more than 2 percent, and losses for MSCI's widely tracked 47-country world index broke $4 trillion, with shares in emerging markets also down sharply.

Investor fears about higher interest rates escalated into rapid, computer-generated selling Monday that wiped out all the market's gains for the year. All 11 sectors of the S&P 500 were down.

This is the most recent day that the Dow Jones fell this much.

Some market watchers fear the USA could be on the brink of recession, but not everyone agrees.

"Once rates started moving, that kind of exposed some of these levered short VIX sales".

Many investors have been bracing for a pullback for months, as the stock market has minted record high after record high with investors encouraged by solid economic data and corporate earnings prospects, the latter bolstered by recently passed USA corporate tax cuts.

Also Wednesday, U.S. crude oil added 29 cents to $63.68 a barrel in electronic trading on the New York Mercantile Exchange.

Oil prices also weighed on the index, with benchmark US crude down 1.3 per cent to $63.35 per barrel. Brent crude, the benchmark for worldwide oil prices, rose 25 cents to $67.11 a barrel in London.

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