Stocks open sharply lower on Wall Street as investors fear a US economic slowdown; Dow drops 1,000 points.
Stocks opened sharply lower on Wall Street on Monday afternoon as investors fear a US economic slowdown.
At the time of writing, the Dow Jones Industrial Average dropped 2.40% to 38,772.21, while the tech-heavy Nasdaq declined 3.74% to 16,152.58. The S&P 500 was also in the red, falling 2.82% to 5,196.00.
It followed European markets also moving lower as risk-off sentiment continues to prevail.
“Markets are experiencing panic selling due to softened economic data in the US, while the Federal Reserve (Fed) remains reluctant to lower interest rates. Investors are concerned that the Fed may be too slow in loosening its monetary policy to avoid an economic recession,” market analyst, Tina Teng, explained.
“Haven assets, including gold, the Japanese yen, the euro, and government bonds, climbed as investors flocked to safer destinations. Additionally, the fear gauge, the CBOE Volatility Index (VIX), spiked 26% to above 23, the highest level seen since March 2023,” she added.
Meanwhile, Asian markets closed poorly on Monday morning, with Japan’s Nikkei 225 Index down 12.4% to close at 31,458 points, the lowest level since December 2023.
