The decline on the US markets continued on Monday. Ongoing concerns about an impending recession in the USA caused the market-wide S&P 500 to fall by 3.00 percent to 5,186 points – this was the largest daily loss since September 2022.
The leading index Dow Jones Industrial fell by 1,033 points (2.6 percent) to 38,703 points. However, the index closed above its daily low. The technology-heavy selection index Nasdaq 100 lost 3 percent to 17,895 points. Within four weeks, the Nasdaq lost more than 12 percent.
Economic fears had recently pushed increasing hopes of an interest rate cut in September into the background. On Friday, a weak US labor market report reinforced investors’ fears that the US economy is cooling down faster than expected and that the hoped-for “soft landing” of the US economy will not be achieved in view of massive waves of layoffs in companies.
Stock market darlings like Nvidia remain under pressure
Chip values, among other things, lost particularly significantly. Thanks to the imagination surrounding the topic of artificial intelligence (AI), they had risen sharply in the recent past and were now coming under particular pressure. The shares of the flagship AI company Nvidia fell by a further 6.4 percent and have already lost almost 30 percent since their record high. A media report weighed on the mood, according to which the chip manufacturer is postponing the launch of new AI chips due to design defects. However, the value has still doubled since the beginning of the year.
Intel loses more than 40 percent within three weeks
Other semiconductor stocks also fell under the wheels, especially the already battered Intel with a similarly high daily loss. Another financial institution, Bank of America, canceled its previously positive recommendation after disappointing quarterly figures and annual targets caused the industry veteran’s shares to collapse. Intel’s market value has almost halved within three weeks.
Buffett has already halved Apple holdings
Papers from the electric car manufacturer Tesla fell by 4.2 percent. The shares of the iPhone manufacturer Apple lost 4.8 percent. At the weekend it became known that the investment company Berkshire Hathaway, owned by well-known investor Warren Buffett, had sold almost half of its stake in shares worth $75.5 billion in the second quarter.
Biontech is clearly in the red
Biontech’s shares listed in New York fell by 4.5 percent. The Mainz-based vaccine manufacturer made a high three-digit million loss in the second quarter on the way to approving new products, for example for the treatment of cancer. The shares of US competitor Moderna lost 3.3 percent in the wake of Biontech – the canceled positive investment recommendation from the Canadian bank RBC also weighed on the mood. The vaccine manufacturer must expect significant short-term headwinds for RSV and Covid vaccines, wrote analyst Luca Issi.
The euro continued to recover and was last trading at $1.0956. At $1.1008, the common currency had temporarily reached its highest level since the beginning of the year. The European Central Bank had set the reference rate at 1.0966 (Friday: 1.0835) dollars and the dollar therefore cost 0.9119 (0.9229) euros.
US government bonds benefited from investors’ risk aversion. The futures contract for ten-year government bonds (T-Note Future) maintained its recent gains in late trading with a narrow decline to 114.11 points. The return was 3.78 percent.
Dax falls to February low
The continued decline on the US stock markets and a sell-off on the Japanese stock market put further pressure on the German stock market on Monday. In addition, the boom around artificial intelligence (AI) suffered another setback. Investors became more nervous. It was again as high as in the Corona crisis, according to the market, with a view to the fluctuation range in prices.
Ultimately, the DAX lost 1.8 percent to 17,339 points and recovered significantly from its daily low of around 17,025 points. However, it remains the lowest level for the German stock market barometer since February. The 200-day line, which is much noticed in terms of chart technology and which provides indications of the longer-term trend and is currently just over 17,400 points, could not be regained. In the three trading days since the beginning of August, the DAX has now lost a little more than six percent. There is currently still 3.5 percent left of its previous annual increase.
The fear of a recession in the United States is also affecting stocks below the Dax. The MDax of medium-sized stocks lost 2 percent to 23,964 points on Monday. The SDax, which had temporarily fallen by almost 6 percent, fell by 2.6 percent. Medium-sized and smaller companies are often particularly dependent on the economic cycle. Things also looked gloomy on the stock markets across Europe. The EuroStoxx 50 lost 1.5 percent to 4,572 points.
Bank stocks in Tokyo on sale
Bank stocks in Japan were hit particularly hard on Monday. The corresponding industry index was in the red at 17.3 percent, making it the bottom performer among the 33 industry indices on the Tokyo Stock Exchange. At the same time, the technology sell-off continues. The chip manufacturer Tokyo Electron had to accept the largest discount at 18.5 percent. Economically sensitive stocks such as the shares of the fashion group Fast Retailing also posted losses.
In this country, the reporting season is entering a new round. The chip company Infineon improved slightly in the third quarter and stopped the downward trend of the previous quarters. However, the recovery is only progressing slowly, as CEO Jochen Hanebeck explained when the figures were presented in Neubiberg near Munich. Infineon shares were recently quoted 0.30 percent higher at EUR 29.61. The Internet and telecommunications group United Internet slightly lowered its expectations for the year as a whole after the temporary failure of its subsidiary 1&1’s mobile network. United Internet’s shares fell by more than nine percent on Tradegate.
Bitcoin is recovering somewhat from its decline
The ongoing decline in Bitcoin dragged the shares of the cryptocurrency trading platform Coinbase further down – they lost 7.3 percent. Bitcoin had previously fallen to $49,374 at times. This was the lowest level since the end of February. As of Friday afternoon, Bitcoin was still trading at almost $60,000.
Oil prices hardly moved after decline
Oil prices continued to rise slightly on Monday. A barrel (159 liters) of North Sea Brent for delivery in October cost $76.99. That was 18 cents more than the day before. The price for a barrel of US West Texas Intermediate (WTI) for delivery in September rose by 8 cents to around $73.60.
Oil prices continued their significant gains from the previous day. Tensions have risen in the Middle East following the targeted killing of a senior leader of the Islamist Hamas in Tehran. According to Hamas, its foreign chief, Ismail Haniya, was killed in an Israeli attack. Iran and Hamas threaten Israel with retaliation. Iran also wants to support Hamas even more.