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The US stock market has crashed! Monday began with depressive calculations

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The US stock market has crashed! Monday began with depressive calculations
February 05
09:00 2018

Regarding the US stock indices. It was clear beforehand that the past week would be the worst for the US stock market in a long time. Now pessimistic forecasts have been expressed in figures. So, Dow Jones has collapsed by more than 1095 points in a week. It is almost identical to the default of the year 2008. In relative figures, the drop in the index has amounted to 4.1%. Another significant S&P index has fallen by 3.9% (the maximum weekly decline in the last two years). The Nasdaq index has declined by 3.5% in a week.

Just on Friday, the decline in indexes was as follows:

  • Dow Jones Industrial Average – minus 665.75 points (2.54%), fell to the value of 25520.96 points;
  • Standard & Poor’s 500 – minus 59.85 points (2.12%), dropped to the level of 2762.13 points;
  • Nasdaq Composite – minus 144.92 points (1.96%), went down to the value of 7240.95 points.

Such a drop was due to the fact that the bond yield had been increased. The thing is that when the bond yields increase, investors try to get rid of stocks and invest in bonds. US Treasuries (US Treasury securities) have shown an increase in yields as a result of the issue of a very strong NFP report. We recall that the NFP report is published once a month and shows the state of the labor market in the United States.

The latest report showed that the number of jobs in the United States had increased by 200 thousand people. The unemployment rate remained at the previous low level of 4.1%; average salaries grew. This may cause some changes in the national basic interest rate. Both Money-Investing portal and the analyst Katya Gordon are going to continue to monitor the changes in the US stock market and inform readers about the development of events.


The material was prepared with the participation of Katya Gordon,
a leading analyst of the brokerage company CT Trade

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