U.S. stock futures fall on growing worries of economic downturn

U.S. stock index futures fell on Thursday on worries of rampant U.S. inflation, recession, a global economic downturn from aggressive interest-rate hikes by central banks, and risks of a potential contagion from a turmoil in UK markets.

Inflation

Reuters:

The Dow and S&P 500 e-minis fell for the seventh time in eight sessions, while megacap growth names such as Amazon.com Inc, Apple Inc, Microsoft Corp, Meta Platforms Inc, and Tesla Inc lost between 0.9% and 2.1% in premarket trading.

The calm brought about by the Bank of England’s decision on Wednesday to buy long-dated government securities to stabilize the turmoil in the markets caused by the government’s new economic plan was short-lived.

Sterling fell and bond prices slid, with the selloff in British assets spilling over to even safe-haven U.S. Treasuries and top-rated German bonds. read more

Even though U.S. stocks ended sharply higher in previous session due to easing Treasury yields, they have been battered for a large part of the year as surging yields dented the appeal for stocks.

“The world is transitioning from a low interest rate environment to a high interest rate environment,” said Andrea Cicione, head of strategy at TS Lombard.

MacDailyNews Take: The era of free money is over.

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3 Comments

  1. What economic downturn? First I’ve heard of it. Actually, I enjoy high crime, high gas prices and high food prices. They match well with the crashing market. Joe’s doing a great job! Can’t wait to vote Dem(ented) straight (are we still allowed to use ‘straight’?) down the ticket in Nov and again in ’24.

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