Dow Jones falls 400 points as global woes deepen

NEW YORK: Turmoil returned to global markets as oil plunged and the Dow Jones Industrial Average sank 400 points, fueling a rush into haven assets.

Corporate results exacerbated the rout, sending MSCI Inc’s gauge of global equities to the brink of a bear market and the Standard & Poor’s 500 Index toward its lowest close in 21 months. Russia’s ruble and Mexico’s peso fell to records, while bets mounted on an end to Hong Kong’s dollar peg. Yields on 10-year Treasuries dropped below 2% and the yen jumped to a one-year high.

Oil’s slump to a 12-year low is ripping through markets. Just on Wednesday, Royal Dutch Shell Plc said profit may drop at least 42% in the fourth quarter and Saudi Arabia was said to order a halt in selling options used to bet against its currency peg. US bonds now predict the slowest inflation since May 2009. A report on Thursday will probably show US crude stockpiles expanded, exacerbating the global glut.