The S&P 500 also suffered its largest weekly percentage decline since June, rocked by concerns about inflation, looming interest rate hikes and gloomy signs around the economic outlook.
Meanwhile, the Nasdaq posted its biggest weekly drop since January, while October 2020 was the last time the Dow Jones index suffered such a steep weekly decline.
“It’s been a rough week. Halloween seems to have come early,” said David Carter, managing director of JPMorgan in New York. “We’re dealing with this toxic concoction of high inflation, high interest rates and low growth, which is not good for the stock or bond markets.”
Risk-off sentiment went from simmering to soaring after FedEx Corp alerted its earnings forecast late Thursday, citing signs of slowing global demand. FedEx’s move followed comments from the World Bank and IMF, both of which warned of an imminent downturn in the global economy.
A spate of mixed economic data, dominated by a higher-than-expected inflation report, cemented the case for the Federal Reserve raises its interest rate by at least 75 basis points at the end of its Fed policy meeting next week.
Based on closing data, the S&P 500 lost 27.03 points, or 0.69%, to 3,873.28; while the Nasdaq Composite Index lost 103.60 points, or 0.90%, to 11,448.76 units. The Dow Jones Industrial Average fell 143.94 points, or 0.46%, to 30,817.88.
The Dow Jones transportation segment, seen as a barometer of economic health, slumped more than 5%, in a low drop led by weakness in FedEx shares.
european bags
European stocks fell 1.6% on Fridayas recession warnings from two major global financial institutions and bets on a big interest rate hike by the US Federal Reserve hit sentiment.
The declines made the STOX 600 suffered its worst week in three months, with a decrease of 2.9%.
With the exception of real estate stocks, the main sector indices were in negative territory, with industrials, healthcare and financials suffering the most.
The STOXX 600 has lost 1.7% so far in September, marking its second consecutive monthly drop, as investors are concerned about rising prices and the energy crisis in the region.
The UK’s FTSE 100 Index fell 0.6% after data showed retail sales fell much more than expected in August, in another sign that the British economy is slipping into recession. However, the index, with a high export component, was the one that fell the least in all of Europe, as the pound weakened.
Source: Ambito
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