A wave of anxiety swept through financial markets yesterday, causing a significant drop in stocks worldwide as investors fixated on signs of a slowing American economy.
The decline extended a sell-off that began on Friday after the U.S. released a job report revealing the highest level of unemployment in nearly three years. This deepened concerns that the world's largest economy might be heading towards slower growth.
Several factors contributed to the plunge, including apprehensions that tech stocks had surged too quickly and fears that a strengthening yen could harm the prospects of Japanese companies and some global traders. In the U.S., there were also questions about whether the Federal Reserve had delayed cutting interest rates for too long.
By the numbers, the U.S. S&P 500 fell 3 percent, marking its worst day since September 2022. Japan's Nikkei 225 index dropped 12.4 percent, its biggest one-day point decline ever. The FTSE 100, Britain's benchmark index, experienced its worst day since July 2023, falling just over 2 percent.
In these turbulent times, columnist Ron Lieber advises that doing nothing might be the best strategy for investors.
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