A stock-market selloff intensified around the world, sending U.S. indexes sliding and volatility spiking to its highest levels since the Covid-19 pandemic.
In early trading, the Nasdaq Composite fell more than 5%, while the S&P 500 fell about 4% and the Dow was around 3% lower.
Painful turbulence started in Japan early Monday, with the Nikkei 225 falling more than 12%, its worst one-day drop since the crash after Black Monday in 1987. Losses then cascaded across South Korea, Europe and the U.S., as investors dumped riskier assets and flocked to safety.
The declines extended what has been a dizzying few days on Wall Street during which this year’s most popular trades have been aggressively unwound. A selloff in tech shares continued Monday, with Nvidia, Meta and Apple each losing 9% or more. (The iPhone maker took an extra hit from news that Berkshire Hathaway had slashed its Apple stake.)
Concerns about a slowing U.S. economy are front and center for investors after job growth slowed sharply in July. Investors are worried that the Federal Reserve has moved too slowly and will need to play catch up in cutting rates.
Around the world, investors rushed for the safety of the bond market. The 10-year U.S. Treasury yield recently traded around 3.69%, down from over 4.1% a week ago and on pace to settle at its lowest level in more than a year.