U.S. stock markets plummeted today as recession fears continue to grow.
Yesterday’s good news about a reprieve on tariffs for U.S. consumer imports was undone by increasing concerns over economic indicators pointing to a potential global recession coming within the next year.
The Dow Jones Industrial Average dropped more than 800 points on Wednesday — its largest decline of the year — while the S&P 500 fell by 85 points and the tech-heavy Nasdaq dropped 240 points.
The downturn in the markets came a day after the Dow closed up 373 points after the U.S. Trade Representative announced a delay in many of the import taxes imposed by the Trump administration planned to impose on Chinese goods.
In the U.S. it was concerns over the news that the yield on 10-year U.S. Treasury notes had dipped below the yield of two-year notes. It’s an indicator that investors think the short term prospects for a country’s economic outlook are better than the long-term outlook for economic health.
China’s industrial and retail sectors both slowed significantly in July. Industrial production including manufacturing, mining and utilities grew by 4.8 percent in July (a steep decline from 6.3% growth in June). Meanwhile retail sales in the country slowed to 7.6 percent, down from 9.8 percent in June.
Germany also posted declines over the summer months indicating that its economy had contracted by 0.1% in the three months to June.
Globally, the protracted trade war between the U.S. and China are weighing on economies — as are concerns about what a hard Brexit would mean for the economies in the European Union .
The stocks of Alphabet, Amazon, Apple, Facebook, Microsoft, Netflix, and Salesforce, were all off by somewhere between 2.5% and 4.5% in today’s trading.