Global Markets Plunge Amid US Recession Fears

Via Syndicated Feed

The Indian stock market's benchmark indices, Sensex and Nifty 50, experienced a significant decline on Monday due to intensified global equity sell-offs, driven by concerns over a potential US recession and rising geopolitical tensions in the Middle East.
Global equity markets dropped sharply as fears grew about a slowing US economy and the Federal Reserve's delayed policy response. Data indicated a weakening US job market, triggering a key recession indicator.
“This sell-off is more about short-term volatility due to profit booking and does not indicate any long-term panic in Indian equities. For investors considering entering the equity market, a staggered approach during volatile periods can be considered,” said Tanvi Kanchan, Head of UAE Business & Strategy at Anand Rathi Shares and Stock Brokers.
The effects were felt in markets worldwide, impacting Asian equity markets, currency markets, and bitcoin prices. Here's an overview of the global markets:
Indian Markets
The benchmark indices of the Indian stock market, Nifty 50 and Sensex, plummeted by over 3% each due to an intensified sell-off across the board. Sensex fell by 2,450.32 points (3.03%) to 78,531.63, while Nifty 50 dropped by 696.35 points (2.82%) to 24,021.35.
As a result of the market crash today, investors lost nearly ₹15 lakh crore in a session. The overall market capitalization of BSE-listed companies decreased to approximately ₹442 lakh crore from nearly ₹457 lakh crore in the previous session.
Asian Markets
Japan’s stock market plunged, with benchmark indices falling more than 20% from their record highs, confirming a bear market as the sell-off from last week continued.
The Nikkei 225 index dropped by 12.40% (4,451.28 points) to 31,458.42, marking its largest points drop in history, while the Topix index fell by 12.23% (310.45 points) to 2,227.15.
A strengthening yen pressured the Japanese stock markets, with the yen surging to 141.73 against the dollar, a level not seen since early January, up from 146.52 yen in New York on Friday.
In other Asian markets, South Korea’s Kospi plunged 8.1% before trading was halted for 20 minutes due to circuit breakers. The Kosdaq dropped 11.71%. Taiwan’s Taiwan Weighted Index fell more than 8% amid selling in technology and real estate stocks. Hong Kong’s Hang Seng index declined by 1.61%, while mainland China’s CSI 300 fell by 0.48%.
US Stock Futures
US stock futures fell following a drop on Wall Street last week that pushed the Nasdaq Composite into correction territory. Nasdaq 100 futures fell by more than 6%, S&P 500 contracts were down by more than 3%, and Dow Jones futures dropped over 1%.
Bond Market
Indian government bond yields fell on Monday, mirroring a sharp decline in US bond yields amid increased expectations of aggressive rate cuts by the US Federal Reserve.
The domestic benchmark 10-year yield dropped to 6.8597%, the lowest level since March 31, 2022, down from its previous close of 6.8945%.
US Treasury yields plunged on Friday. The US 10-year yield fell to its lowest level since December and continued to decline during Asian trading hours on Monday, according to Reuters. It was last at 6.7565% during Asian trading hours, while the 2-year yield stood at 3.8216%.
Currency Market
The Indian rupee fell to an all-time low on Monday, impacted by the stock market crash as concerns over a US recession led to outflows from local equities amid a global sell-off. The rupee dropped to a record low of 83.82 against the US dollar and was last quoted at 83.8125, down about 0.1% from its previous close of 83.75 on Friday.
The Japanese yen, a safe-haven and popular carry trade currency, traded at 143, up 2.3% against the dollar, reaching levels last seen on January 2, according to Reuters. The yen has rallied 10% against the dollar in just over three weeks, driven partly by the Bank of Japan’s interest rate hike last week and the unwinding of yen-funded carry trades.
Cryptocurrencies
Cryptocurrencies also faced heavy selling on Monday due to risk aversion in global markets, with Bitcoin prices falling by about 15%.
The leading cryptocurrency, Bitcoin traded 15.5% lower at $51,323.58, extending a 13.1% drop from last week, the worst decline since the FTX exchange collapse. Ethereum's price fell by 22.3% to $2,262. Most other major cryptocurrencies were also significantly down.
Gold Market
Gold prices increased on Monday due to safe-haven demand amid risk aversion in global financial markets. Spot gold rose by 0.14% to $2,446.83 per ounce, after initially dropping 1% earlier in the session. US gold futures increased by 0.8% to $2,488.50.
In India, the MCX gold rate traded 0.19% higher at ₹69,925 per 10 grams, while the MCX silver price decreased by 0.39% to ₹82,168 per kg.
With reporting by Reuters
IndraStra Global Staff has not edited this story, which is auto-generated from a syndicated feed.

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