US stock markets see another wild day amid concerns over Fed and Ukraine
US stock markets were hit by another wave of wild trading on Monday as investors worried that the Federal Reserve would wind down its support for the economy faster than expected and fears of a possible Russian invasion of Ukraine intensified.
Last week’s sharp selloffs were repeated in early trading on Monday but by the end of the day, the S&P 500 stock index regained its losses, ending up 0.29%, the Dow Jones rose 99 points, or 0.29%, after dropping 1,115 points at its low, and the tech-heavy Nasdaq gained 0.5%.
Stock markets hit record highs after highs last year. But so far this year the S&P 500 has fallen at its fastest rate on record, according to data compiled by Bloomberg, and on Monday it briefly fell 10% from its most recent high on 3 January before regaining ground.
The Fed meets this week and on Wednesday will give a clearer picture of how quickly it will raise interest rates in order to tackle soaring inflation.
European and UK markets racked up heavy losses earlier in the day. In London, the FTSE 100 fell 2.6% to a one-month low. The pan-European Stoxx 600 index closed 3.8% lower, its biggest one-day fall since June 2020. In Germany the Dax fell by 3.8%, and France’s CAC index lost 4%.
The selloff swept across other assets, driving down the price of oil as well as bitcoin and other cryptocurrencies. Bitcoin too regained ground but has now shed half its value since hitting record highs around $69,000 in November.
Jack Ablin, founding partner and chief investment officer at Cressett Capital, said that, with some provisos, the worst of the falls might be over. “I don’t think this will go for much longer,” he said. “Most of the damage has been done.”
Ablin said he expected more problems ahead for some tech
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