Recession Fears Grow; Market Wipes Out Nearly $3 Trillion in 1 Day

Financial analysts say fears of a global recession have risen after a dramatic $2.9 trillion drop in stock market values.

The drop, reported on August 2, 2024, is the biggest since March 16, 2020, when the COVID pandemic sparked similar concerns.

Jacob King, a financial analyst, highlighted that major stock indices have suffered serious losses due to growing recession fears. This decline was triggered by disappointing U.S. employment data, which showed slower job growth and rising unemployment—the highest since October 2021. In addition, the weak performance of the U.S. manufacturing sector and weak earnings at semiconductor giant Intel worsened the situation.

On this turbulent day, the major world indices fell significantly. The S&P 500 index, tracking the 500 largest U.S. companies, faced its worst session in nearly two years. The Nasdaq Composite dropped 2.6%, and the Dow Jones Industrial Average fell 2%, or 820 points. Prominent technology stocks were hit hard, with Amazon shares plunging 12.5% on missed earnings expectations and a dismal forecast. Intel shares fell 29%, and Nvidia also saw a significant decline on the day.

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Deutsche Bank’s Jim Reed noted that the recent decline reflects rising risk sentiment in the market, exacerbated by weak U.S. economic data and disappointing technology earnings. This global market decline underscores widespread concern about a potential economic slowdown.

Kosta Gushterov

Kosta has been working in the crypto industry for over 4 years. He strives to present different perspectives on a given topic and enjoys the sector for its transparency and dynamism. In his work, he focuses on balanced coverage of events and developments in the crypto space, providing information to his readers from a neutral perspective.