The milestones in the U.S. market reversal piled up on Monday.
The S&P 500's 2.7% plunge marked its worst day of the year, as it closed below its 200-day moving average for the first time since 2023. 'Big Tech' mega caps were battered, and the tech-heavy Nasdaq clocked a 4% loss for the first time since 2022. The VIX 'fear index' of volatility hit its highest point since the yen-inspired explosion last August.
In single stock moves, Tesla's 15% drop stood out. The auto giant has now lost more than 50% of its value since it peaked in December.
Perhaps as worrying as the equity moves was the disturbance in the credit market, with borrowing premia on high-yield U.S. corporate bonds rising to the widest level versus U.S. Treasuries since September.
There was no clear fresh trigger behind Monday's slide apart from ongoing trade tariff uncertainty and the softening jobs market, with President Donald Trump and administration officials acknowledging that an economic downturn was a risk in the first quarter.
The New York Federal Reserve's latest consumer survey highlighted growing concerns about deteriorating household financial situations. And the percentage of those expecting unemployment to be higher a year from now rose to its highest level since September 2023.
Even though the Fed has made it clear that interest rates are on hold for the foreseeable future, a dash for safety in Treasuries saw two year yields hit their lowest point since October, and traders nudged 2025 Fed easing bets up to 85 basis points.
The dollar also slipped again on Tuesday to another 2025 low.
As major investment banks downgraded previously 'overweight' U.S. equity recommendations, anxiety spread around the world. The MSCI's all-country stock index is now negative for the year, too.
However, stock futures and overseas bourses steadied early on Tuesday with small gains.
Let's now take deeper look at some potentially game-changing shifts happening in Europe.
0 comentários:
Postar um comentário