How far will share prices go down? That’s a question that can’t be answered yet. At the moment, it’s mainly technology stocks that are being sold.
The wave of selling on the US markets continued on Monday. The downward trend initially continued, especially on the Nasdaq technology exchange, which had previously performed well. Then a recovery began, at least temporarily.
Concerns about a looming recession in the US had recently pushed growing hopes of an interest rate cut in September into the background. On Friday, a weak US labor market report increased investors’ fears that the economy would cool down faster than expected.
The leading index, the Dow Jones Industrial, recently lost 2.58 percent to 38,713.93 points. This means it is heading for its third day of losses in a row. The situation is similar for the other indices: the broad market S&P 500 fell by 2.87 percent to 5,193.29 points. The Nasdaq 100 index fell to 17,435 points, then rose 600 points again. The most recent loss was around 2.3 percent at around 18,000 points.
The Nasdaq 100 was particularly burdened by the ongoing weakness of chip stocks such as Nvidia. They had risen sharply in the recent past thanks to the excitement surrounding the topic of artificial intelligence (AI) and are now coming under particular pressure.
At the start of the week, investors once again fled to safe havens. Ten-year US government bonds rose in early trading to their highest price since June last year.
Shares in AI flagship company Nvidia fell 6.1 percent. Sentiment was dampened by a media report that the chip producer was postponing the launch of new AI chips due to design defects. However, the stock has still more than doubled in value since the beginning of the year. Other semiconductor stocks such as Intel, Micron Technology and Broadcom were also under heavy pressure on Monday. Bank of America, another financial institution, withdrew its previously positive recommendation for Intel after disappointing quarterly figures and annual targets had hit the industry veteran’s shares.
Shares in electric car manufacturer Tesla fell by 3.9 percent. Shares in iPhone manufacturer Apple lost 3.3 percent. Over the weekend, it was announced that the investment company Berkshire Hathaway, owned by well-known investor Warren Buffett, had sold off almost half of its holdings in the second quarter, with shares valued at 75.5 billion US dollars.
Biontech’s shares, listed in New York, fell by 5.4 percent. The Mainz-based vaccine manufacturer made a high three-digit million loss in the second quarter on the way to approval of new products, for example for the treatment of cancer. Shares in US competitor Moderna lost 4.7 percent in the wake of Biontech – here the canceled positive investment recommendation of the Canadian bank RBC also weighed on sentiment. The vaccine manufacturer must expect considerable headwinds in the short term with RSV and Covid vaccines, wrote analyst Luca Issi.
The ongoing decline in Bitcoin pulled shares of the cryptocurrency trading platform Coinbase further down – they lost 6.3 percent.
Against the general weakness in share prices, Kellanova’s shares jumped by 12.3 percent. Industry colleague Mars is interested in the breakfast cereal manufacturer, reported the Bloomberg news agency, citing informed sources.
Source: Stern
