Stocks fell on Monday as markets around the world grappled with a disappointing jobs report last week that fueled concerns about a possible recession.
Major U.S. stock indexes fell more than 2 percent in early trading.The P 500 index fell about 4%, while the tech-heavy Nasdaq fell more than 6%. The Dow Jones Industrial Average lost about 1,000 points, or nearly 3%.
The market slowdown has prompted calls for a major interest rate cut at the Federal Reserve’s next meeting in September. Some investors have voiced an even more urgent demand, for an emergency rate cut as early as this week.
Japan’s Nikkei 225 stock index fell more than 12%, its worst trading day since 1987.
In early U.S. trading, chipmaker Nvidia fell more than 14%, while Apple lost more than 8%.
“Investors are feeling tremendous pain globally,” Dan Ives, managing director of equity research at investment firm Wedbush, said in a note to clients. U.S. markets, he added, “are trading heavily in the red across the board.”
Employers hired 114,000 workers in July, well below the 185,000 jobs economists had expected, according to data released Friday by the U.S. Bureau of Labor Statistics. The unemployment rate climbed to 4.3%, its highest level since October 2021.
The unemployment rate has climbed from 3.7% to 4.3% this year. That trend has triggered a recession indicator known as the “Sahm rule,” which states that a 0.5 percentage point increase in the unemployment rate over a 12-month period typically precedes a recession.
Goldman Sachs economists on Sunday raised the probability of a U.S. recession next year from 15% to 25%.
This is a developing story. Please check back regularly for updates.
