The turmoil led to significant losses, with various indexes experiencing their worst performance in months.
This marked the steepest three day percentage declines for these US indexes since June 2022.
The widespread market downturn began as concerns over a US recession intensified following a series of economic data releases that suggested weakening economic conditions. Investors were particularly alarmed by the unexpected rise in the US unemployment rate and slower-than-expected jobs growth, which fueled fears of an impending slowdown.
Addressing whether more pain is still to come, Kevin Nicholson, global fixed income chief investment officer at Riverfront Investment Group, said time will tell. “I think that the data will play out over time and let us know if today’s reaction is an overreaction or the appropriate reaction,” he commented to the news outlet.
US Federal Reserve policymakers, including Chicago Fed President Austan Goolsbee and San Francisco Fed President Mary Daly, recently dispelled notions of an economic freefall, despite the necessity of rate cuts to prevent a downturn.
“As you see jobs numbers come in weaker than expected but not looking yet like recession, I do think you want to be forward-looking at where the economy is headed for (in) making the decisions,” he added.
Securities Disclosure: I, Giann Liguid, hold no direct investment interest in any company mentioned in this article.
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