Global Markets React to U.S. Stock Market Slump
HONG KONG (AP) — As U.S. stocks closed out their worst month since September, global markets reacted with a mix of gains and losses on Wednesday. While Britain’s index opened higher, Japan and Australia saw declines, with most markets closed for a holiday.
In the United States, shares were set to drift lower as Dow futures lost 0.1% and S&P 500 futures dipped 0.3%. Investors are eagerly awaiting the U.S. Federal Reserve’s interest rate decision later in the day.
London’s FTSE 100 opened higher, with the index up 0.2% to 8,159.46 in early trading. Meanwhile, Tokyo’s Nikkei 225 index lost 0.3% after Japan’s factory activity experienced a milder shrink in April. The yen continues to struggle, with the U.S. dollar rising to 157.97 Japanese yen.
Australia’s S&P/ASX 200 also dipped 1.2% to 7,569.90, while other markets were closed due to the Labor Day holiday.
The U.S. stock market slump was triggered by a report showing U.S. workers won bigger gains in wages and benefits than expected during the first three months of the year. While this signals a strong job market, it also raises concerns about inflation.
The Federal Reserve is not expected to change its main interest rate at this meeting, but traders are anxious about Fed Chair Jerome Powell’s outlook for the rest of the year.
In the midst of the market turmoil, some companies saw significant movements in their stock prices. GE Healthcare Technologies tumbled 14.3%, while 3M rose 4.7% after reporting stronger results than forecast. Cannabis companies also saw a surge in stock prices after reports of the U.S. Drug Enforcement Administration’s plan to reclassify marijuana as a less-dangerous drug.
Overall, the earnings reporting season has been better than expected, with tech companies and various industries performing well. In the bond market, the yield on the 10-year Treasury rose to 4.69%.
As global markets continue to react to the U.S. stock market slump, investors are closely monitoring developments and preparing for potential shifts in the economic landscape.
