Stocks Are Set to Extend Sharp Fall

The equity markets indicated a further drop this week when the Futures trading was started on Sunday evening, with investors and economists who set themselves with the increase in the chances of a serious economic recession caused by the significant new rates of President Trump on imports.

The future on S&P 500, which allow investors to bet on the index before the official start of the negotiations on Monday, decreased by about 4 percent. The drop of 10.5 percent on Thursday and Friday in the’s & P 500 was the Worst decline of two days for the index From the beginning of the Pandemia del Coronavirus in 2020.

The only other cases of a two worst falls fall during the 2008 financial crisis and the collapse of the 1987 share market, according to Howard Silverblatt, Senior Index Analyst at S&P Dow Jones Indices. In terms of dollars, the over $ 5 trillions that have been swept away in the value of the’s & p in the two days of last week have no equal.

Even more unusual is that the Sell-off last week derived directly from the presidential policy. Trump has so far wiped out the concerns about the market reaction and the potential economic consequences, showing little intention to retreat.

“The reason why I believe is the largest debacle ever seen in the markets is because it is purely self -inflicting from Trump,” said Dan Ives, a Wedbush Securities technological veteran, warning that if the rates announced last week will remain in place, they will put back the US technology industry, a decade and will offer a push for the fallatura of China in intelligence. artificial.

“The economic pain that will be caused by these rates is difficult to describe,” he said.

The historically high rates that Mr. Trump announced on Wednesday has captured investors, economists and businessmen abruptly, to overturn global economic forecasts.

The managers began to warn consumers who should expect prices to increase on some food, clothes and other products. Consumers said they intend to curb the shopping for large tickets. Some car companies have already announced production pauses abroad, as well as work losses at national level. Bank economists have increased the chances of a recession will hit the United States in the next 12 months. While the countries responded last week with their rates, the seat in the financial markets is accelerated.

The manager of the Hedge Fund Bill Ackman declared on the social media platform for Sunday that he had supported Mr. Trump’s attempt to set global rates, but implored the president to call a “90 -day timeout” on Monday.

Otherwise, “we are going to a self -induced economic nuclear winter and we should start landing,” he said. “May prevail the freshest heads.”

Keir Starmer, the British Prime Minister, warned on Saturday that “the world as we knew that it went” and urged the countries not to take revenge against the United States and enter a real commercial war.

The S&P 500 is now 17.4 percent below the peak reached in February, on the route to participate in a bears market, defined as a drop of 20 percent or more by a recent peak.

The Nasdaq composite index, which is full of technological titles that has been under pressure while the Sell-off accelerated last week, is already in a bears market, down almost 23 % from the peak of December. The Russell 2000 index of smaller companies that are more sensitive to the prospects for the economy has decreased by 25 % since the November peak.

However, some investors remain cautiously optimistic that the solid economy since the beginning of this year will resist the assault of high rates, before the president turns into tax cuts and deregulation to stimulate the economy and avoid a recession.

Scott Besent, the secretary of the treasure, said on Sunday on the NBC program “Meet the Press” that he saw “no reason” to expect a recession.

Other analysts have warned that the damage to the economy will depend on how long the rates remain at high levels.

“We are very cautious,” said Stuart Kaiser, an analyst of Citi. Even with the decline last week, he said, the markets could have further down there because the expectations of earnings and economic growth remain “well above the levels consistent with the announced tariff levels”.