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US: stock markets fluctuate wildly over Ukraine concerns & Fed jitters

US: stock markets fluctuate wildly over Ukraine concerns & Fed jitters

On Monday, US stock markets were reportedly slammed by another round of frantic trading, as investors fretted that perhaps the Federal Reserve might reduce its economic support sooner than planned and worries of an invasion by Russia probably intensified in Ukraine.

The sharp selloffs of last week recurred in early trading, but the S&P 500 stock index recovered its shortfalls by the end of the day, eventually ending up 0.29%, the technology-heavy Nasdaq managed to gain 0.5%, while the Dow Jones jumped 99 points or 0.29% up, having dropped 1,115 points at its low,

Following the record highs of last year, stock markets have touched new highs. However, according to data, the S&P 500 declined at its quickest rate recorded thus far this year, and it nearly dropped 10% from its recent high on  January 3rd before finding some momentum on Monday.

The Federal Reserve will convene this week and announce on Wednesday how swiftly it will hike interest rates to battle rising inflation.

Earlier in the day, UK and European markets suffered significant losses. The FTSE 100 index in London plummeted 2.6% to a one-month low. Also, the pan-European Stoxx 600 index fell 3.8% the same day, the largest one-day drop as of June 2020. The Dax in Germany plummeted 3.8%, while the CAC in France dropped 4%.

The selloff spread to certain other assets, causing the oil price, along with bitcoin as well as other cryptocurrencies, to plummet. While Bitcoin regained its momentum later, it has already lost half of its value after having reached record highs in November with roughly $69,000.

Jack Ablin, Cressett Capital’s chief investment officer, and founding partner believes that the worst of the declines could be over, with some downsides. Ablin added that most of the harm has already been done.

Ablin also predicted that some technology businesses that saw a surge during the Covid-19 pandemic, will face further issues in the future.

Markets would undoubtedly collapse if the conditions in Ukraine worsened or if China perceived Russia's actions as an opportunity to press its claims on Taiwan.

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Sunil Jha

Sunil Jha has been a part of the content industry for close to two years. Having previously worked as a voice over artist and sportswriter, he now focuses on writing articles for, across a slew of topics, ranging from technology to trade and finance. With a business-oriented educational background, Sunil brings forth the expertise of deep-dive research and a strategic approach in his write ups.