Stocks Plunge: Nikkei Down 13%, European Shares Near Six-Month Lows

Created by : News Desk View profile

 and  -- Reuters

Aug. 5, 2024

Summary

  • European markets open lower, trade down 2.5%
  • Nikkei closes almost 13% lower, Nasdaq futures dive 5%
  • Circuit breakers tripped by torrent of selling
  • Markets see 50 bps Fed cut in Sept, maybe even earlier
  • Dollar falls 2% on safe haven yen, 1% on Swiss franc

SYDNEY/LONDON, Aug 5 (Reuters) - Stock markets tumbled on Monday, with Japanese shares at one point exceeding their 1987 "Black Monday" loss, as fears of a U.S. recession sent investors fleeing from risk while wagering that rate cuts would be needed to rescue growth.

The safe haven yen and Swiss franc surged, as crowded carry trades unraveled, sparking speculation that some investors were unloading profitable trades to get money to cover losses elsewhere. Such was the torrent of selling that circuit breakers were triggered on stock exchanges across Asia.

Japan's benchmark Nikkei average (.N225), opens new tab closed 12.40% lower at 31,458.42, its largest one-day fall since October 1987, while the broader Topix (.TOPX), opens new tab lost 12.48% to 2,220.91.

European stocks (.STOXX), opens new tab opened 1.8% lower with France's CAC 40 (.FCHI), opens new tab down 2.1%, Spain's IBEX (.IBEX), opens new tab down 2.8% the UK's FTSE 100 (.FTSE), opens new tab off 1.7% on fears of a global recession after weak U.S. data.

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