Major Averages Posting Steep Losses In Early Trading

(RTTNews) - On the heels of a global sell-off, stocks have shown a substantial move to the downside to start the first trading day of the New Year. The major averages have fallen sharply in early trading, adding to the losses posted in the final week of 2015.

The early weakness on Wall Street comes following a steep drop by Chinese stocks, as China's Shanghai Composite Index plummeted by 6.9 percent.

The steep drop by the index triggered a trading halt on the Chinese markets, with authorities utilizing new market circuit breakers for the first time.

Disappointing manufacturing data contributed to the weakness among Chinese stocks and led to worries about the global economy.

Negative sentiment has also been generated by the release of disappointing U.S. data, including a report from the Institute for Supply Management showing a continued contraction in manufacturing activity.

Most of the major sectors have come under considerable pressure on the day, reflecting broad based weakness on Wall Street.

Internet stocks are posting particularly steep losses, resulting in a 3.9 percent drop by the Dow Jones Internet Index. Netflix (NFLX) has helped to lead the sector lower after Baird downgraded the stock to Neutral from Outperform.

Airline, financial, software, and biotechnology stocks are also seeing significant weakness, while gold stocks are among the few groups bucking the downtrend.

Currently, the major averages are just off their worst levels of the day. The Dow is down 386.62 points or 2.2 percent at 17,038.41, the Nasdaq is down 142.45 points or 2.8 percent at 4,864.97 and the S&P 500 is down 44.84 points or 2.2 percent at 1,999.10.