Banks and tech stocks fare worst as weak US economic data could push Fed into making rapid interest rate cuts
An electronic stock board shows that Nikkei stock average dropped over 1,900 Japanese yen from previous day, in Tokyo. Photograph: Kyodo News via APGlobal stocks tumbled on Monday, with Japan’s Nikkei index plummeting 13 per cent, as markets were rattled by the prospect of a US recession.
Financial sectors were hit the most on the day. Banks lost 4.2 per cent, financials services shed 3.6 per cent while and the tech sector slipped 5 per cent.Nursing home fees: can I claim tax relief on behalf of my dad? “I’m not expecting a bounce for a little while, because right now we have this perfect storm of the Japanese carry trade being unwound, weakness in US Big Tech and Middle East tensions,” said Seema Shah, chief global strategist at Principal Asset Management.
“The Japanese market is seen by global investors as a warrant on global trade,” said the Japan head of one global pension fund. “So if you are in severe de-risking mode, as a lot of investors are at this point because of US recession fears and geopolitics, it makes sense you take profits in a Japanese market that has done very well so far this year.”
The global turbulence extended to the crypto market, with the price of bitcoin falling more than 17 per cent to $52,000 on Monday, while the price of ether, another cryptocurrency, has fallen almost 17 per cent to $2,200.
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