The New York Stock Exchange fell at the open on Monday, appearing to panic in the wake of a stock market rout, as fears of a U.S. recession loom and the yen’s rally disrupts investment flows.
The Dow Jones Industrial Average was down nearly 3%, the Nasdaq was down 5.50% and the S&P 500 was down 4% in early trading as bond yields sank.
This is the second consecutive session of decline for the New York Stock Exchange. The latest report on employment in the United States shows a faster-than-expected deterioration in the labor market, which raises fears of the arrival of a recession.
Dow Jones futures were down 3.17% by 1245 GMT. The tech-heavy Nasdaq futures were down 5.80% and the broader S&P 500 index was down 4.46%.
“After Friday’s jobs report, recession risks have increased,” said Will Compernolle of FHN Financial, who is now betting on a deeper rate cut by the Federal Reserve of 0.75 percentage points by year-end and another full percentage point cut next year.
On the bond market, borrowing rates for government debt securities have fallen to their lowest level in over a year for ten-year rates.
“The summer lull is over! Stock markets are in turmoil and bond yields are plunging as fears of a US recession have grown,” Neil Shearing of Capital Economics also said.
On the value side, Apple is set to collapse by 10%, Nvidia by 13% and Amazon by 8%.
Further details will follow.