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Dow Plunges Nearly 800 Points, Trade Slowdown Blamed
Fears of a trade slowdown created market uncertainty and helped fuel a nearly 800-point decline in the Dow on Tuesday. The stock market dropped 3.1%, with the S&P 500 declining 3.2%, and the Nasdaq sliding 3.8%.
An optimistic truce between the U.S. and China was short-lived, and the financial markets have become increasingly worried about a recession. Tech stocks, which had been the bedrock gainers of the stock market over the last several years, fell sharply. Apple and Alphabet lost more than 4% each, while Amazon and Netflix sank more than 5%.
The selloff erased roughly $800 billion from the S&P 500’s market value, according to S&P Dow Jones Indices. It was the Dow’s fourth-biggest point decline in history, though on a percentage basis, the loss isn’t among the past decade’s worst 25 days. Analysts point out the three major indexes are still on positive footing for the year.
This week, there’s also been a significant narrowing of the gap between short and long-term Treasury rates. Economists note the yield curve has inverted before nearly every recession, when short-term rates rose higher than long-term rates. The gap between the 10-year and two-year Treasury yields is now the smallest it has been since just before the Great Recession.
For comments, questions or concerns, please contact Dennis Kaiser
- ◦Economy
