Global stocks plunge, bond prices rally as US data spooks
employment data on Friday stoked fears of a recession ahead, prompting investors to dump stocks and turn to safe-haven bonds.
Treasury prices surged, sending yields to multi-month lows.
Oil price benchmarks fell by more than $3 per barrel at their session lows. The U.S. dollar index dropped over 1% to its weakest since March.
Richly valued technology firms bore much of the pain, and an index of European bank stocks headed for its largest weekly decline in 17 months on soft earnings.
The VIX stock market volatility measure, dubbed Wall Street's fear gauge, surged over 40%.
Friday's U.S. jobs report showed job growth slowed more than expected in July and unemployment increased to 4.3%, pointing to possible weakness in the labor market and greater vulnerability to recession.
Markets were already rattled by downbeat earnings updates from Amazon and Intel and Thursday's softer-than-expected U.S. U.S. factory activity survey in addition to the monthly U.S. non-farm payrolls report, which showed job growth slumped to 114,000 new hires in July from 179,000 in June.
The data raised expectations of multiple rate cuts by the Federal Reserve this year, which just this week opted to keep rates unchanged.
«The jobs data are signaling substantial further progress that the Federal Reserve made a policy error by not reducing the fed funds rate this week,» said Jamie Cox, managing partner for Harris Financial Group in Richmond, Virginia.
«It's very possible the Fed alters its inter-meeting communications on the balance of
