recession in america
US recession: The latest economic data in the US is pointing towards a slowdown. Recession in the US may gradually become a reality in the coming times. This is also an indication of a decline in US stocks. Fears of a US recession have been increasing steadily since the beginning of August. Although the US stock market has been able to recover from previous declines related to employment data, there are still several major problems in the market, which are working against the economy and there is a possibility of a recession in the US.
rising recession risk
Economic data is pointing towards a decline in the major stock markets. Premium assets like S&P 500 are also showing a downward trend. IT stocks have not seen any rise for a long time. Based on economic data, the risk of recession is constantly increasing and American traders are expecting a cut in interest rates. Last Friday, employment data was released in the US. These figures again affected the stock market. The US stock market was previously in the recovery phase, but things look uncertain at this time. If the stock market falls in the next few weeks, the initial effects of recession can be easily seen. There will be a big drop in the valuation of many companies.
Last week was the worst in the last 18 months
Wall Street once again saw a huge decline on Friday. The much-awaited update about the US employment market came out quite weak. In such a situation, tech stocks, which had jumped high earlier, suffered losses again. This has increased concerns about the economy. The S&P 500 fell 1.7 percent and it was its worst week since March 2023. Broadcom, Nvidia and other tech companies dragged the market down, as concerns persisted that their prices had risen too much in the boom around AI and they dragged the Nasdaq Composite down by 2.6 percent in the market. The Dow Jones Industrial Average fell 410 points, or one percent, after erasing the morning’s 250-point gain.
Volatility in the bond market too
The bond market also saw sharp volatility after the employment report, with Treasury yields falling, then recovering, and then falling again. The report showed that US employers hired fewer workers in August than economists expected. It was touted as the most important employment report of the year and it showed the second consecutive month that hiring fell short of forecasts. It also followed recent reports showing weakness in manufacturing and some other sectors of the economy.
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