Wall St dips to two-month low as recession worries grow



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Wall St dips to two-month low as recession worries grow

On Friday, all three key indices of Wall St were bottomed to a nearly two-months low, as recession fears seemed to be taking a greater toll on market participants’ morale. Nevertheless, despite a warm opening of the day, a sharp sell-off began to take place after FedEx had warned of an impending global-scale slowdown on Friday.

As FedEx profit warning had hammered investors’ morale, Wall Street ended sharply lower and the week had turned to a red sea of Nile for US money markets. All three key US indices had fallen to a level never seen since mid-July.

In tandem, a raft of fundamentals had tarnished outlook over the week, as Tuesday’s CPI data that underscored US inflation rose unexpectedly by 0.1 per cent in August had ramped up bets for an aggressive policy stance from the US Fed.

Adding another ominous sign, later this week, PPI (Producers Prices Index) data had illustrated that the US producers’ cost had increased significantly, suggesting a likely upsurge in consumers’ goods’ prices in September, eventually, adding holocaust to growth stocks which are more susceptible to an aggressive US Fed monetary policy stance.

If truth is to be spoken, a hawkish US Fed stance in order to promote dollarization as fretted by several market participants and analysts coupled with an inflation-burst, would comfortably stem a recession as warned by heavy-weight lender JPMorgan earlier last month.

Wall St totters as recession worries heighten

Citing statistics, on Friday’s Wall St wind-down, trade-sensitive Dow faltered 0.45 per cent to 30,822.42 and Wall Street benchmark S&P 500 shrugged off 0.72 per cent to 3,873.33, while tech-heavy Nasdaq was nudged as much as 0.90 per cent lower to 11,448.40.

Over the week, Dow jolted 4.16 per cent and S&P 500 had been hit with a hefty whiplash of 5.15 per cent, while Nasdaq took a teetering header of 5.97 per cent.