Wall Street tumbles to a two-month low
All three major US stock indices fell well below their numbers set in the month of June, primarily due to the less-than-encouraging CPI report, global slowdown and FedEx's dismal first-quarter report.
Ever since the Consumer Price Index report was released, the US stock market has continued to take a beating. On Friday, according to a Reuters report, Wall Street stumbled to its two-month low as fears of a global recession loomed amid a slowdown.
Reportedly, all three major US stock indices fell well below their numbers set in the month of June. The Dow dropped 139. 40 points to close at 30,822 while S&P 500 closed the week by siding 0.72 per cent. Lastly, Nasdaq Composite slide 0.9 per cent to finish at 11,448.
"It’s been a tough week. It feels like Halloween came early. We are facing this toxic brew of high inflation, high-interest rates and low growth, which isn’t good for stock or bond markets." said David Carter, managing director of JP Morgan.
It is pertinent to note that the fear of global slowdown amongst the stock market investors was expedited after FedEx released a dystopian earning report.
The company's revenue fell about $300 million below company forecasts which hastened the warning that a slowdown was impending.
Moreover, to get ahead of the curve, banking major Goldman Sachs is planning to fire hundreds of its employees as early as next week. Reportedly, the layoffs will mark the resumption of its annual practice which was halted the last two years due to the pandemic.
It is pertinent to note that on the day the CPI report showed inflation hitting a worse-than-expected mark of '8.3' per cent, US President Joe Biden threw an 'inflation reduction' party at his official residence at the White House.
"Exactly four weeks ago, I signed the Inflation Reduction Act into law. So today, we're celebrating. Tune in at 3 PM ET as I deliver remarks and welcome the leaders and advocates who made it happen to the People's House." tweeted President Biden from his official Twitter account.
Experts believe that after inflation numbers continued to hit a 40-year record high, the US central bank, the Federal Reserve may be hiking interest rates for a record fifth time this year, next week.
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