Wall Street declines significantly as a result of the stock market

The New York Stock Exchange fell sharply on Monday after the stock market climate, amid fears of a recession in the United States and the recovery of the yen disrupted investment flows.

The Dow Jones index lost almost 2.38%, the Nasdaq fell 3.81% and the S&P 500 by 3.16% around 2:30 pm GMT.

“The summer lull is over!

Friday after the publication of earnings figures that were worse than expected, the Nasdaq had already entered the correction zone, losing 2.43% to 16,776.16 points. A correction means a loss of 10% from the peak.

The Dow Jones lost 1.51% to 39,737.26 points and the broader S&P 500 index lost 1.84% to 5,346.56 points.

As for Monday morning values, Apple lost 5.08%, Nvidia -6.77% and Tesla -5.72%.

For Peter Cardillo of Spartan Capital, the normalization of the market “is the result of a combination of factors, between the fear of a slowdown in the American economy and the disconnection of the carrier trade”.

Hedge funds are moving away from their traditional trade, which involved borrowing yen at low rates to invest in riskier assets, such as Nasdaq growth stocks.

But now that the yen is strengthening and the BoJ has opened the door to rate hikes, “money is flowing out of the stock market, especially in Japan,” Mr Cardillo said. when the Nikkei fell 12,000 closing Monday.

Wall Street indexes began to weaken sharply on Friday after July employment figures showed a rise in the unemployment rate to 4.3% from 4.1%. Job creation slowed to 114,000 compared to 179,000 in June.

“We have to keep in mind that the job creation data was still positive,” Peter Cardillo said in a statement.

CFRA’s Sam Stovall also believes that “investors have adopted a ‘shoot first, ask questions later’ mentality”.

“Concerns about a recession and the Japanese market falling into the correction zone in a few days are causing panic among investors,” said the analyst interviewed by AFP.

He also noted that the news that Warren Buffett has sold half of his interest in Apple since the second quarter, increasing his cash reserves rather than shares, made the market nervous.

When its results were presented, the group Berkshire Hathaway (-3.43%) revealed that it had sold 49% of its shares in the Apple company, after selling 13% in the first quarter .

In terms of values ​​around 2:20pm GMT, the eleven sectors of the SP 500 were all in the red, starting with information technology (-4.74%), discretionary spending (-3.66%) and communication services (-3.18 % ).

Bank deposits did not fare much better (-2.80%).

On the other hand, the action of the Kellanova group, maker of breakfast waffles and snacks (+13.25%) was sought while the giant of chocolate bars, Mars (unlisted) would aim to buy could be up to 30 billion dollars, according to the Wall Street Journal.

On the bond market, lending rates for government debt securities fell to their lowest level in more than a year for ten-year rates (3.76%), indicating a flight to safety, while the price of bonds rises when their output drops.

1. Nasdaq