The Nasdaq plunged below 12,000 points, dropping 4.3% to 11,623.25 points, and the Dow Jones dropped 2% to 32,245.70 points.
The New York Stock Exchange fell again on Monday, weighed down by technology and energy stocks, reflecting concerns about inflation, the response of the US central bank (Fed) and a possible recession.
According to final results, the Dow Jones index dropped 1.99% to 32,245.70 points.
The tech-heavy Nasdaq plunged 4.29% to 11,623.25 points, slipping below 12,000 points for the first time since November 2020.
The technical threshold of 4,000 points for the S&P 500 did not hold, the index falling 3.20% to 3,991.24 points, the lowest in a year.
“Investors are unable to buy on the downside, to buy the + dip + (the hollow, editor’s note). There is no trust,” said Gregori Volokhine of Meeschaert Financial Services.
“The market’s problem is that it does not see what would be the good news that would allow it to rebound,” he summed up. “And if we don’t buy when it drops, it can continue to drop…”
The New York indices therefore started the week deep in the red, after already six weeks of losses in a row for the Dow Jones and five for the Nasdaq and the S&P 500.
“Persistent inflation has prompted the Fed to become more aggressive in its rate hike campaign, but this has fostered uncertainty about its ability to stage a soft landing,” Schwab analysts fear.
“Rising interest rates and the strong dollar continue to undermine morale and signal tighter financial conditions, as war in Ukraine and lockdowns in China darken the picture,” they added.
Investors also showed their nervousness before the publication on Wednesday of the inflation figure in the United States for April (CPI index).
The rise in prices excluding food and energy could have continued to accelerate, with +0.4% over the month against +0.3% in March, according to analysts’ forecasts. Inflation should remain above 8% over one year, a peak in forty years.
The greenback sailed around its highest in twenty years, while bitcoin, a risky asset, plunged 10% around 8:00 p.m. GMT, to the lowest in almost a year and a half, at 30,700 dollars.
The technology sector, sensitive to the rise in interest rates which affect the future profits of these growing companies, has been hard hit.
Apple lost 3.32%, Amazon 5.21%, Tesla 9.07%. In semiconductors, AMD and Nvidia lost more than 9%.
Rivian, the maker of electric pickups that went public in November, fell 20.88%. Ford, one of its largest shareholders, has sold a large stake in the young company, according to press reports.
Uber, which announced spending cuts, fell 11.59% to $23.25.
The stock of data analytics and intelligence group Palantir tumbled more than 20% to fall around $7, below its IPO price two years ago. The company posted a stronger-than-expected loss in the first quarter.
Reflecting fears for oil demand and the pace of global activity with anti-Covid health restrictions in Beijing, energy stocks and crude prices have plunged in concert.
Crude oil prices ended down almost 6%.
Oil stocks, the sector in the best shape since the start of the year and therefore also subject to profit taking, lost 8.30% within the S&P.
Exxon ended down 7.81%, Chevron 6.63% and Occidental Petroleum fell 10.92%.
Driven by the general ebb, Boeing, heavyweight of the Dow Jones index, was offloaded by 10.47% to 133.31 dollars.
The VIX index, known as the “fear index”, which measures market volatility, climbed to nearly 35%, its highest level in two months.
Bond yields on 10-year Treasury bills, which had hit 3.20%, their highest since November 2018, before Wall Street opened, stabilized at 3.03% around 8:30 p.m. GMT.