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The stock market experienced a massive global sell-off on Monday, with the Dow dropping over 1,000 points and the Nasdaq losing almost 600 points.
The bloodbath in the stock market has been caused by several factors, including renewed concerns about a potential recession in the U.S. due to rising unemployment rates. Moreover, the Bank of Japan’s decision to raise its benchmark interest rate has caused the value of the yen to rise, and Japanese stocks have suffered their biggest fall since 1987. The country’s Nikkei stock index dropped by over 12% on Monday. Meanwhile, the European stocks on the Stoxx 600 index also dropped nearly 3.5%.
As the day ended, the Dow Jones Industrial Average dropped 1,033 points, or 2.6%, to 38,703. The tech-heavy Nasdaq shed over 576 points or 3.4%, while the S&P 500 has the worst day since 2022, losing 160 points or 3%. Additionally, U.S. Treasury yields plummeted due to recession fears, with investors seeking refuge in global bonds. The benchmark 10-year note on Monday yielded 3.7%.
AI and tech stocks are suffering
The recent market downturn has had a significant impact on AI and tech stocks. By the end of the day, Nvidia’s shares had lost over 6%. Apple’s stock declined nearly 5% after Warren Buffett’s Berkshire Hathaway reduced its stake in the company by half. Google’s parent company, Alphabet, dropped nearly 4.5%, and Meta’s stocks declined by 2.5%.
Bitcoin is bleeding, too
The Bitcoin price plummeted from $70,000 to $50,000 in just a week. In the past 24 hours, the leading cryptocurrency has declined by over 15%, and by over 26% in the past week.
Not only that, but Ether, the second largest cryptocurrency by market capitalization, dropped to $2,200 – a level it has not seen since December 2023. The performance of Ether has worsened as spot Ether ETFs have experienced significant outflows in the past few days, totaling a net outflow of $511 million since its launch.
Among major cryptocurrencies, Solana, Dogecoin, and Cardano have dropped over 19%, 21%, and 17% in the past 24 hours. The global cryptocurrency market cap has fallen to $1.78 trillion, marking a decrease of over 17%.