As the Dow drops more than 1000 points, concerns over an economic slowdown grip the market, impacting high-flying technology stocks.
At 16:00 ET (20:00 GMT), the Dow Jones Industrial Average fell 1033 points, or 2.6%, the S&P 500 dropped 2.9%, and the Nasdaq slumped 3.4%.
Slowdown fears batter Wall Street, but economic data shows underlying strength
Recent hefty losses in the stock market have been driven by fears of an economic slowdown, with weak readings indicating concerns over interest rates and a potential soft landing for the economy.
Despite the data driving hopes for more interest rate cuts by the Federal Reserve, it has also reduced appetite for risk-driven assets.
Fed speak in focus
Federal Reserve speakers are closely monitored this week as investors anticipate aggressive rate cuts. The likelihood of a 50 basis point cut in September is currently at 78%.
Some Wall Street analysts are still skeptical, with Morgan Stanley suggesting that while there are signs of cooling, it may not justify a 50bp cut in September.
Apple leads rout, Google in legal woe
Apple, Alphabet, Nvidia, Lucid Group Inc, and BioNTech are some of the companies experiencing stock declines due to various reasons like stake sell-off, legal issues, and product delays.
High profile earnings continue
While most mega-cap companies have already reported earnings, there are still some high-profile results expected in the coming days, including Caterpillar, Uber Technologies, Super Micro Computer, Disney, and Warner Bros Discovery.
Analysis:
The recent stock market plunge, fueled by fears of an economic slowdown, has led to significant losses in major indices and technology stocks. Investors are closely watching Federal Reserve speakers for signals of aggressive rate cuts to combat weakening economic indicators. The decline in stock prices of companies like Apple, Alphabet, and Nvidia is a reflection of broader market concerns. Moving forward, high-profile earnings reports from companies like Caterpillar, Uber, and Disney will continue to drive market sentiment.