Wednesday was the worst day for the US stock market. As a result of trading, the market lost 3%. Concerns about the recession in the United States as well as not very good statistics from Germany and China have resulted in the fall.
Trading caused the situation when the yield on two-year government bonds was higher than the yield on 10-year securities. This phenomenon is called a “yield curve inversion” and counts as a sign of recession. Inversion was observed before the last five recessions in America.
The growth in demand for long-term securities also explains the fall in the yield.
China’s production growth rate has fallen to its lowest level over the past 17 years. In June, the production increased 4.8%. Last year, this figure was 6.3%. Experts predicted an increase of 5.8%.
Federal Statistical Office of Germany (Destatis) has presented a report on the country’s GDP. It says that in Q2, GDP has fallen 0.1% compared with Q1 of this year. Germany’s annual gross domestic product grew 0.4%. Experts predicted that the annual growth would be at least 0.5%.
The Dow Jones Index is calculated on the basis of quotes of 30 companies, which shares declined on Wednesday. Only 3 companies from the S&P 500 index showed the growth.
Securities of JPMorgan Chase and ExxonMobil have dropped more than 4%. Caterpillar, the world largest construction equipment manufacturer, has lost 3% of its stock value.
Wayfair Online Store has lost 10% of the value of its securities. This happened after the company had announced their intention to place bonds for 750 million US dollars.
After Macy’s presented its 2Q earnings report and lowered its annual forecast, the company’s capitalization decreased by 13%.
Dow Jones has lost more than 800 points, dropping to 25479 p. S&P 500 fell 85 points- to 2840 p, Nasdaq has stopped at 7774 p.
The material was prepared with the participation of Katya Wilson,
a leading analyst of the brokerage company UFT Group