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New York - US stocks fell sharply on Tuesday after China unexpectedly devalued its currency, as Apple, General Motors and other companies heavily exposed to China dropped.
The Dow Jones Industrial Average closed down 212.33 points at 17 402.84.
The broad-based S&P 500 fell 20.11points to 2 084.07, while the tech-rich Nasdaq Composite Index tumbled 65.01 points to 5 036.79.
China's central bank devalued its yuan currency on Tuesday by nearly 2% against the US dollar, as authorities said they were seeking to push market reforms, in the context of a slowing economy.
The move raised concerns about a strengthening US dollar and whether the Chinese economy is weaker than thought.
Among the stocks to fall sharply were Apple (-5.2%) and General Motors (-3.5%), both of which are relying on China as a major growth market.
GM said its exposure to fluctuations in the yuan is "limited and manageable", in part because its factories in China gives it a "natural hedge" against currency moves.
"We continue to expect strong results in China will be sustained through the remainder of the year," the automaker said in a statement.
US-listed Chinese companies fell, including Alibaba (-3.9%), Baidu (-5.0%) and JD.com (-6.8%).
Metals producers Freeport-McMoRan and Alcoa sank 12.3% and 6.0%, respectively, as prices for aluminum and copper retreated following the yuan devaluation.
Google jumped 4.3% after it announced a new corporate structure in which the search engine company will become part of a larger company that will be called Alphabet. The shift is intended to let Google pursue new growth businesses such as Google Glass and Google TX without detracting from core revenues.
US computer security company Symantec tumbled 6.9% after announcing it would sell its data management business Veritas to a group of investors for $8bn in cash. Credit Suisse downgraded Symantec, saying the sale of Veritas would result in a large tax liability.
Bond prices rose. The yield on the 10-year US Treasury dropped to 2.14% from 2.23% on Monday, while the 30-year slipped to 2.81% from 2.90%. Bond prices and yields move inversely.
