FirstFT: US stocks fall on fears of slowing growth
Investors sold stocks and bet on less aggressive policy from the Federal Reserve yesterday after comments from social media group Snap and disappointing economic data raised fears that growth in the United States was about to slow. considerably.
The Nasdaq Composite, which is weighted by large US tech companies, fell 2.3% in mid-afternoon in New York. The more balanced S&P 500, which tracks the fortunes of the largest publicly traded companies, fell 0.8%. By the closing bell, however, both indices had eased off the lows reached at the start of the session.
US equities have been hit hard this year, with the broad-based Russell 3000 average share falling more than 40% from recent highs as the Fed raised interest rates in its bid to curb inflation . Recent data indicating slowing growth has added pressure on stocks, as investors warn that the U.S. economic recovery from the coronavirus pandemic could run out of steam.
Fund managers instead sucked up US government debt by swapping riskier investments for safe havens. The 10-year Treasury yield, which moves with economic growth and interest rate expectations, fell 0.09 percentage points to 2.76%, its biggest one-day price rise since end of April.
Snap shares fell 43% yesterday. The group said its sales and profit for the current quarter would be lower than its previous expectations and that “the macroeconomic environment has deteriorated further and faster than expected” since issuing its guidance in April, leaving the nervous investors.
Thanks for reading FirstFT Asia. Here is the rest of the news of the day — Sophia
Five other stories in the news
1. Chinese and Russian nuclear bombers fly over the Sea of Japan Although Moscow said the 1 p.m. flight took place “in strict accordance with the provisions of international law”, Japan yesterday denounced the joint exercise as “unacceptable”. It is the first maneuver of this type to occur with an American president in the region.
2. Hungary declares state of emergency caused by war in Ukraine Prime Minister Viktor Orbán gave his government the right to rule by decree in response to an “economic crisis” caused by war in neighboring Ukraine and sanctions against Russia. Orbán will present the measures to be adopted today. The announcement follows his refusal to discuss the proposed Russian oil embargo at next week’s EU leaders’ summit.
3. Quad unveils maritime satellite initiative to counter China The United States, Japan, Australia and India have launched a satellite initiative that uses near real-time intelligence to help countries in the Indo-Pacific region track illegal fishing and unconventional maritime militias . It will also strengthen capacities to combat human and arms trafficking.
4. Airbnb ditches China as zero Covid policy crushes tourism The online travel group has announced that it will close its operations in China this summer. After six years of trying to break into the market, Airbnb has been strangled by the impact of Beijing’s harsh zero-Covid strategy on domestic and international tourism.
5. Soaring steel prices hurt South Korean shipbuilders’ hopes of recovery Despite soaring orders and rising prices for new container ships and LNG carriers, rising steel prices are expected to delay South Korean shipbuilders’ return to profitability. The price recently increased by 8% after doubling in the past two years.
The day ahead
Meta board Peter Thiel is stepping down from Meta Platform’s Board of Directors at today’s annual meeting of shareholders. He has served on the board since 2005, a year after Facebook launched.
Amazon shareholder vote At today’s annual shareholder meeting, Amazon shareholders will vote to approve a 20-to-1 stock split. If approved, the new shares will begin trading June 6, shareholders receiving 19 additional shares for each share they hold.
Economy of the European Union The ECB publishes today its half-yearly stability review, and the OECD will publish its economic outlook for the euro zone.
Davos ECB President Christine Lagarde, Irish Taoiseach Micheál Martin, Dutch Prime Minister Mark Rutte and European Parliament President Roberta Metsola take part in a Davos forum on EU unity in response to the Russian invasion of Ukraine.
To remember George Floyd Today marks the second anniversary of the murder of George Floyd. His killing by a police officer sparked protests around the world and drew attention to racial disparities in the United States.
What else we read
South Korea Turns Against Crypto Leader ‘Lunatic’ Do Kwon, the brash 30-year-old man behind terraUSD, is now “South Korea’s most hated man” after the stablecoin collapsed. Kwon’s high-profile backers, global marketing strategy and killer social media personality have helped attract attention and retail investors. But now many savers have lost everything.
Monkeypox: what you need to know about the virus Discovered in laboratory monkeys in 1958 and in a human 12 years later, monkeypox usually emerges from close contact with animals in sub-Saharan Africa. Nearly 100 cases have been recorded in at least a dozen countries, the largest outbreak of the virus outside sub-Saharan Africa, and EU officials are seeking to procure smallpox vaccines to suppress it.
The West is divided on how the war in Ukraine should end As the Russian war enters its fourth month, Western leaders ponder the prospect of a protracted conflict. The possibility of a Ukrainian victory raised multiple questions. What does “winning” mean? Is it to push the Russians back to where they started in February – or also to retake territories occupied since 2014?
Further reading: The World Economic Forum has been fundamentally changed by the war in Ukraine. Financiers and CEOs are no longer the rulers of the universe as nationalism and militarism take over in Davos.
The rise of the Middle East and the hope for sustainability Luxury companies are seeing a surge in spending in the Middle East thanks to rising oil prices, strong economic growth and a return to local shopping. While the two most important luxury markets – the United States and China – look less than rosy, the Gulf Cooperation Council countries, which include Saudi Arabia and the United Arab Emirates, are expected to see an increase in 6.1% of their GDP this year.
‘Exxon of the past is dead’ after upheaval A year ago, the No. 1 activist hedge fund engine’s long-running victory — winning three seats on the conservative supermajor’s board — rocked ExxonMobil and Big Oil. Goals to eliminate net emissions from operations by 2050, spending limits on fossil fuel projects and a new low-carbon company are all signs of change.
The Financial Times’ insider guides to big cities travel to Singapore and visit the top five spots for brunch, from a former British army barracks to key spots for plane and superyacht spotters.