Global market crash: From Asian markets to crypto prices, US recession fears jolt financial markets globally

Indian stock market benchmark indices, Sensex and Nifty 50, witnessed a heavy sell-off on Monday as the rout in global equities intensified amid US recession concerns and escalating the geopolitical tensions in the Middle East.

The global equity markets plummeted as the sell-off was fuelled by growing concerns that the US economy is slowing and the Federal Reserve is behind the curve with policy support. Data showed the US jobs market weakening, which triggered a closely watched recession indicator.

“This sell off is more of a short term volatility by way of profit booking and is no indicator of any long term panic mode set in the Indian equities. For investors looking at entering the equity market, a staggered entry during volatile periods can be considered,” said Tanvi Kanchan, Head – UAE Business & Strategy, Anand Rathi Shares and Stock Brokers.

The repercussions were witnessed in markets across the globe – from Asian equity markets, to currency markets to bitcoin prices. Here’s a look at global markets:

Indian stock market

Indian stock market benchmark indices Nifty 50 and Sensex crashed more than 3% each as sell-off intensified across the board. Sensex traded 2,450.32 points, or 3.03%, lower at 78,531.63, while Nifty 50 tumbled 696.35 points, or 2.82%, to 24,021.35.

Investors lost nearly ₹15 lakh crore in a session amid the stock market crash today as the overall market capitalisation of the BSE-listed companies dropped to nearly ₹442 lakh crore from nearly ₹457 lakh crore in the previous session.

Asian Markets

Japan’s stock market tumbled with the benchmark indices falling more than 20% from their record highs, confirming a bear market, as sell-off continued from last week.

The benchmark Nikkei 225 index plunged 12.40%, or 4,451.28 points, to 31,458.42 — its largest points drop in history — while the broader Topix index declined 12.23%, or 310.45 points, to 2,227.15.

A resurgent yen weighed on the Japanese stock markets. The yen surged to 141.73 against the dollar, a level not seen since early January, from 146.52 yen in New York on Friday.

Among other Asian markets, South Korea’s Kospi plunged 8.1% before trading was halted for 20 minutes due to the exchange’s circuit breakers. The Kosdaq dropped 11.71%.

Taiwan’s benchmark, Taiwan Weighted Index declined more than 8% amid selling in technology and real estate stocks. Hong Kong Hang Seng index fell 1.61%, while mainland China’s CSI 300 declined 0.48%.

US Stock Futures

US stock futures fell following a drop on Wall Street last week that led the Nasdaq Composite dropping into correction territory. Nasdaq 100 futures tumbled more than 6% and S&P 500 contracts were down more than 3%. Futures of Dow Jones plunged over 1%.

Bond Market

India government bond yields fell on Monday tracking a sharp decline in US peers amid rising bets of aggressive rate cuts by the US Federal Reserve.

The domestic benchmark 10-year yield was at 6.8597%, lowest level since March 31, 2022, compared with its previous close of 6.8945%.

US Treasury yields nosedived on Friday. The US 10-year yield dropped to the lowest level since December and extended decline in Asian hours on Monday, Reuters reported. It was last at 6.7565% in Asian hours, while the 2-year yield was at 3.8216%.

Currency Market

Indian rupee fell to an all-time low on Monday weighed down by the stock market crash as concerns over a US recession spurred outflows from local equities amid a global stocks sell-off. The rupee declined to a record low of 83.82 against the US dollar and was last quoted at 83.8125, down about 0.1% from its close at 83.75 on Friday.

Japanese yen, a safe-haven and carry-funding favourite, traded at 143, up 2.3% versus the dollar, and at levels last seen on January 2, Reuters reported. The yen has rallied 10% against the dollar in just over three weeks, driven in part by the Bank of Japan’s interest rate rise last week and an unwinding of yen-funded carry trades.

Cryptocurrencies

Cryptocurrencies also reeled under heavy selling amid a risk aversion in global markets on Monday, with the Bitcoin prices falling around 15%.

Top token Bitcoin price traded 15.5% lower at $51,323.58, adding to a 13.1% drop last week that was the worst since the period when the FTX exchange imploded. Ethereum price declined 22.3% to $2,262. Most other major cryptocurrencies were deeply in the red.

Gold Rate Today

Gold prices rose on Monday on safe-haven demand as the global financial markets are in a risk-averse mode. Spot gold rose 0.14% to $2,446.83 per ounce, after falling 1% earlier in the session. US gold futures rose 0.8% to $2,488.50.

MCX gold rate today traded 0.19% higher at ₹69,925 per 10 grams, while MCX silver price fell 0.39% to ₹82,168 per kg.

(With inputs from Reuters)

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.