· Stocks plunged Wednesday in the Dow Jones Industrial Average’s worst performance of 2019 after the bond market flashed a troubling signal about the U.S. economy.
The Dow dropped 800.49 points or 3.05% to 2,5479.42, its worst percentage drop of the year and fourth-largest point drop of all time. The S&P 500 fell 85.72 points or 2.93% to 2,840.6, while Nasdaq Composite declined 3.02% to 7,773.94. The Dow gave up the entire rebound from a sell-off earlier in August and fell to a two-month low.
· European stocks closed sharply lower Wednesday as weak economic data and bond yield curve inversions fueled fears of a global recession.
The pan-European Stoxx 600 closed provisionally down 1.8%, with all sectors and major bourses trading firmly in the red.
Economic data released on Wednesday morning showed that Germany’s GDP (gross domestic product) shrank by 0.1% between April and June, fueling fears of a recession for Europe’s largest economy and likely denting investor sentiment.
This weighed on the rest of the bloc, with euro zone GDP growing by just 0.2% quarter-on-quarter, a significant slowdown from the 0.4% growth reported in the first three months of the year.
· Shares in Asia dropped Thursday morning as the main yield curve in U.S. Treasurys inverted, triggering fears over the state of the U.S. economy.
In Japan, the Nikkei 225 fell 1.88% in morning trade, while the Topix index dropped 1.73%. Australia’s S&P/ASX 200 also tumbled 1.91%.
The MSCI Asia ex-Japan index shed 0.59% overall.
Markets in South Korea and India are closed on Thursday for holidays.
The yield inversion between the 10 and 2 year Treasury note happened again in the morning of Asian trading hours, with the yield on the 10-year Treasury note last at 1.5741%, as compared to the 2-year rate at 1.5751%.
Bank stocks across the region also fell on Thursday, after financials stateside saw a rout overnight amid the market turmoil on Wall Street.
Reference: CNBC
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