U.S. stocks plunge
On Monday, U.S. stock markets experienced a sharp decline as concerns about an economic slowdown hit technology stocks particularly hard, News.Az reports citing Investing .
By 14:53 ET (18:53 GMT), the Dow Jones Industrial Average had fallen by 1011 points, or 2.5%, while the S&P 500 and NASDAQ Composite dropped by 3.1% and 3.8%, respectively.
This downturn follows last week's sharp declines fueled by fears of slowing economic growth. A series of weak economic indicators have heightened concerns that the Federal Reserve has kept interest rates too high for too long, diminishing the chances of a soft landing for the economy.
Concerns were exacerbated on Friday when July’s nonfarm payroll data fell significantly short of expectations, indicating a notable cooling in the labor market. While the disappointing jobs report increased hopes for interest rate cuts by the Federal Reserve, it also dampened investor interest in riskier assets.
In a recent note, Goldman Sachs stated, "We now expect faster cuts because the funds rate looks more clearly inappropriately high; the Fed looks behind, having worried too much about inflation for too long and held steady in July; and the rationale for cutting now includes the more urgent priority of supporting the economy."
Nevertheless, Monday’s economic data suggest that a recession might not be imminent. The July ISM Services PMI exceeded economists’ forecasts, and the prices paid, an inflation indicator, also surpassed expectations. These figures indicate some resilience in certain sectors of the economy, offering a glimmer of hope amid current market volatility.
By 14:53 ET (18:53 GMT), the Dow Jones Industrial Average had fallen by 1011 points, or 2.5%, while the S&P 500 and NASDAQ Composite dropped by 3.1% and 3.8%, respectively.
This downturn follows last week's sharp declines fueled by fears of slowing economic growth. A series of weak economic indicators have heightened concerns that the Federal Reserve has kept interest rates too high for too long, diminishing the chances of a soft landing for the economy.
Concerns were exacerbated on Friday when July’s nonfarm payroll data fell significantly short of expectations, indicating a notable cooling in the labor market. While the disappointing jobs report increased hopes for interest rate cuts by the Federal Reserve, it also dampened investor interest in riskier assets.
In a recent note, Goldman Sachs stated, "We now expect faster cuts because the funds rate looks more clearly inappropriately high; the Fed looks behind, having worried too much about inflation for too long and held steady in July; and the rationale for cutting now includes the more urgent priority of supporting the economy."
Nevertheless, Monday’s economic data suggest that a recession might not be imminent. The July ISM Services PMI exceeded economists’ forecasts, and the prices paid, an inflation indicator, also surpassed expectations. These figures indicate some resilience in certain sectors of the economy, offering a glimmer of hope amid current market volatility.
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