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The S&P 500 dropped 75.62 points, or 1.4%, closing at 5,446.68. Dow Jones Industrial Average fell by 494.82 points, or 1.2%, to 40,347.97. Nasdaq plunged 405.25 points, or 2.3%, ending at 17,194.15 read more
 "Recession worries after weak manufacturing data drag Wall Street indices")
Wall street indices closed in the red on Thursday (August 1) over fears of a recession. Image courtesy: Moneycontrol
Wall Street stocks tumbled Thursday (August 1) after weak manufacturing data sparked worries about a US recession.
US equities had initially risen at the open of trading, buoyed by Federal Reserve Chair Jerome Powell’s indication of a potential interest rate cut in September during a press conference on Wednesday.
The optimism was short-lived. Stocks began moving lower after the Institute for Supply Management’s manufacturing index came in at 46.8 per cent in July, a decline from the prior month and weaker than analysts had estimated. This contraction in the manufacturing sector sparked fears of a recession.
The S&P 500 sank 75.62 points, or 1.4 per cent, closing at 5,446.68. The Dow Jones Industrial Average dropped 494.82 points, or 1.2 per cent, ending at 40,347.97. The Nasdaq Composite saw the steepest decline, collapsing 405.25 points, or 2.3 per cent, to 17,194.15.
Market movers
Moderna plunged 21.01 per cent after slashing its 2024 sales forecast for its COVID-19 and respiratory syncytial virus vaccines by up to 25 per cent.
Arm Holdings’ conservative revenue forecast led to a 15.72 per cent drop in its shares. Qualcomm also suffered, stumbling 9.37 per cent after flagging a revenue hit from trade curbs. The broader selloff in chip stocks saw Nvidia fall 6.67 per cent.
Heavyweights in the tech and consumer discretionary sectors also weighed heavily on the indices. Apple fell 1.68 per cent, and Amazon lost 1.56 per cent ahead of their quarterly results due after the closing bell.
Meta Platforms proved to be a rare bright spot. The company behind Facebook and Instagram climbed 4.8 per cent after reporting profit and revenue for the latest quarter that topped analysts’ expectations.
Eli Lilly also rose 3.5 per cent following trial results showing that its weight-loss drug Zepbound reduces the risk of hospitalisation and death in obese adults with a common type of heart failure.
Bond market dynamics
The yield on the 10-year Treasury tumbled below 4 per cent, back to levels not seen since February. The drop was driven by the soft manufacturing data and additional reports showing the highest number of US workers applying for jobless benefits in about a year, alongside improved productivity for US workers during the spring.
The manufacturing data, coupled with rising jobless claims and the Fed’s cautious stance, painted a bleak picture for the US economy, leading investors to retreat from equities and seek safer havens in bonds.
With inputs from agencies
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English (US) ·