US open: Dow plunges over 200 points as investors fear rate hike

US stocks swung to losses early on Tuesday, as investors feared the Federal Reserve will raise interest rates soon.

Just after 10:00 in New York, the Dow Jones Industrial Average was down by 220 points, with the S&P 500 and the Nasdaq losing 21 and 55 points respectively.

The dollar soared to near a 12-year high against the euro, gaining 0.8% against the European currency and 0.2% against the pound. However, the greenback slid 0.2% against the yen, while gold futures advanced 0.25% to $1,169.40.

“Regardless of whether the Fed hikes in June or September, it’s coming and it’s not very far away,” said Craig Erlam, senior market analyst at Oanda.

“That makes the dollar very strong compared to its peers, even sterling which is in a similar position with the Bank of England seen raising rates later this year. Today’s rally in the dollar has weighed on commodities as a stronger dollar makes them more expensive when priced in other currencies.”

Meanwhile, job openings in the US rose 2.4% to 5m in January, reaching a 14-year high, according to the Labor Department.

Official figures showed that the number of people hired fell marginally to 5m, while separations – which include layoffs, workers who quit and who are fired – dropped from 4.90m to 4.82m.

In company news, Urban Outfitters gained almost 9% after reporting better-than-expected fourth quarter earnings on Monday night.

Lumber Liquidators Holdings jumped 10% after releasing the agenda for a conference call with investors scheduled for Thursday, in which it will provide an update on its products’ safety.

Newmont Mining gained 1% in the wake of an upgrade from analysts at Jeffries.

Bookseller Barnes & Noble fell over 3% after its quarterly profit fell share of analysts’ expectations.

United Rentals was another among the S&P 500 biggest losers, with shares in the equipment rental group down 3%, or 14% in the year to date.

Oil prices fell sharply, with Brent crude losing 2.4% to $57.14 a barrel, while West Texas intermediate shed over 1% to $49.47 a barrel.