World markets
Wall Street recorded the biggest daily drop in stock prices since mid-March
On Wall Street, stock indexes sank more than 5 percent on Thursday, their biggest daily decline since mid-March, as investors' hopes of a quick recovery of the world's largest economy from the corona crisis plummeted.
The Dow Jones sank 1,861 points, or 6.90 percent, to 25,128 points, while the S&P 500 slipped 5.89 percent, to 3,002 points, and the Nasdaq index 5.27 percent, to 9,492 points.
In all 11 major sectors of the S&P 500 index, stock prices fell more than 3 percent yesterday as investors were concerned about news of rising numbers of new coronavirus infections in some states that recently lifted restrictive health measures.
Health experts have warned that the death toll from the coronavirus could reach 200,000 by September, before the number of new infections is brought under control.
"The reality is that economic risks will last longer than the market estimated. The market may have grown too fast in recent weeks, ”says Dan Deming , CEO of KKM Financial.
Thanks to huge fiscal and monetary stimulus measures, the S&P 500 index has risen more than 35 percent since March 23, so at the beginning of the week it approached the record level, reached on February 19, at only 6 percent.
According to some macroeconomic reports, investors had hoped for a quick recovery of the economy from the corona crisis and a way out of the recession, but were disappointed by estimates and messages from the US Federal Reserve.
The Fed announced on Wednesday after a two-day session that the US economy could fall 6.5 percent this year and rise 5 percent next year.
He also said key interest rates will remain low until 2022 because, as Fed President Jerome Powell said, there is a long road to recovery.
"The Fed's message that it will keep interest rates stable until 2022 has led investors to conclude that the Fed is more concerned about the pace of economic recovery than before," said Joseph Sroka, director at NovaPoint.
And on European stock exchanges, stock prices fell yesterday. The London FTSE index slipped 3.99 percent, to 6,076 points, while the Frankfurt DAX sank 4.47 percent, to 11,970 points, and the Paris CAC 4.71 percent, to 4,815 points.
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