Market Sharply Lower at Open

U.S. stocks opened sharply lower Wednesday after weak manufacturing data out of China and a gloomier assessment of the economy from the U.S. Federal Reserve.

The Dow Jones Industrial Average (DJIA) was down 200 points, or nearly 2%, at the open, after shedding 0.5 percent in the previous session.  All 30 Dow components were lower at the start, led by DuPont (DD), Disney (DIS), and Cisco (CSCO).

The pace of growth in Chinese investment and factory output slowed in July, raising worries about the nation's economy, which has been expected to drive the global recovery. Retail sales were also softer than expected.  In U.S. economic news, trade deficit widened more than expected to 18.8% in June on a surge of consumer goods from China and other suppliers, while U.S. exports fell, a government report showed on Wednesday.  Mortgage purchase and refinancing applications, meanwhile, rose by less than 1% in the first week of August, even as 30-year loan rates fell to 4.57%, the lowest in 20 years of record keeping by the Mortgage Bankers Association. 

European stocks were down  in morning trade, led lower by banks such as Societe Generale and UBS, while the Nikkei index fell 2.7%, suffering its worst session in nearly a month as a stronger yen deepened worries about the longer-term prospects for Japan's economy. 

The dollar fell to an eight-month low versus the yen on Wednesday as traders pared back on risk following the decision from the Fed to invest proceeds from mortgage backed securities into government debt.