As negative sentiment in global markets grew, US stocks dipped in early trade on Monday.
Even as investors worried about further COVID-related lockdowns in China, US markets extended losses in the early session on Monday after finishing substantially lower last week. The dips are also due to concerns over the US Federal Reserve’s indication of a more aggressive approach to monetary policy.
In mid-day trading, the S&P 500 was down more than 1.5 percent, continuing early-day pessimism. On the other hand, the blue-chip index has witnessed a modest gain, bringing its loss to -0.7 percent (at 1:35 ET).
The Dow Jones Industrial Average (DJIA), which had lost more than 400 points and was down 1.2 percent at one point, had a similar prognosis. In mid-afternoon trade, the Dow was 140 points lower. The Dow Jones Industrial Average dropped about 1000 points last Friday, marking the fourth week of losses for markets.
The Nasdaq Composite dropped more than 1% in early trading but has since rebounded to be +0.2% lower.
US Treasury yields fell as well, with the benchmark 10-year yield falling to 2.779 percent. Oil prices plummeted another 5% to $96.36 per barrel, while gold prices declined roughly 2% to $1,897 per ounce.
Stocks in Asia and Europe are being sold off at a rapid pace
On Monday, while Wall Street was under pressure, Asia and Europe’s stock markets were downbeat.
As a result of the sell-off, China’s Shanghai Composite Index fell 5.1 percent, its worst single-day performance since February 2020. In Monday’s trade, the Nikkei 225 index in Japan dropped 1.9 percent, while the Hang Seng index in Hong Kong slid 3.7 percent.
Fears of fresh infections and Chinese lockdowns hampered risk-on appetite among European investors, causing a sell-off in Asian assets that was replicated across Europe. The pessimism stemmed from a broader fear of inflation and the imposition of fresh sanctions against Russia.
The Stoxx 600 index in Europe plummeted 1.8 percent, while the CAC in France dropped 2% and the DAX in Germany fell 1.5 percent. The FTSE 100 fell 1.9 percent in the United Kingdom.
Twitter stock up
In early trading on Monday, Twitter (NYSE: TWTR) shares were up over 5%. Elon Musk was said to be on the verge of buying the company, according to news sources. TWTR was up 4.87 percent on the day to $51.36.
The largest losers of the day include Netflix Inc. (NASDAQ: NFLX) and Walgreens Boots Alliance Inc. (NASDAQ: WBA). Other notable decliners included Chevron, Verizon, and Nike.
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