Posted on 05/19/2022 3:57:39 AM PDT by John W
LONDON (Reuters) - Heavy falls in European and Asian stock markets followed Wall Street’s worst day since mid-2020 on Thursday, as stark warnings from some of the world’s biggest retailers underscored just how hard inflation is biting.
Bond markets rallied in the dive for safety and on bets that interest rate rises may get recalibrated, but it was the gloom striking down equities after Wednesday’s $25 billion wipeout in U.S. retailer Target’s shares that dominated the action.
“Target and Walmart coming out with disappointing numbers has really, really spooked people,” said Close Brothers Asset Management’s Chief Investment Officer Robert Alster. “We are going to see a raft of downgrades to U.S. GDP (forecasts) now... it really looks like we are running into a faster slowdown than we expected.”
The S&P 500 had lost 4% on Wednesday while the Nasdaq had fallen almost 5% as interest-rate sensitive megacap stocks Amazon, Nvidia and Tesla dropped close to 7% and while Apple tumbled 5.6%.
MSCI’s broadest index of Asia-Pacific shares ex-Japan then snapped four days of gains as it slumped 1.8%, dragged down by a 1.65% loss for Australia’s resource-heavy index, a 2.5% drop in Hong Kong. Tokyo’s Nikkei shed 1.9% too.
Tech giants listed in Hong Kong were hit particularly hard, with the index falling nearly 4%. China’s online behemoth Tencent sank more than 6% after it reported no revenue growth in the first quarter, its worst performance since going public in 2004.
China’s technology sector is still reeling from a year-long government crackdown and slowing economic prospects stemming from Beijing’s strict zero-COVID policy.
The focus remained on what central banks will now do as they walk the tightrope of trying to regain control of inflation, which is now at 40-year highs in some countries, without causing painful recessions.
(Excerpt) Read more at stocks.apple.com ...
Close Brothers Asset Management’s Chief Investment Officer Robert Alster. “We are going to see a raft of downgrades to U.S. GDP (forecasts) now... it really looks like we are running into a faster slowdown than we expected.”
it really looks like we are running into a faster slowdown than we expected.
a faster slowdown than we expected.
Buy buy buy!!
Makes me hungry for some jumbo shrimp.
Unexpected?
Biden’s recession. Looks like a lock when the 2nd quarter GDP is read out short of the deep state cooking the books.
The Biden Economic Miracle ‘22
I am sadly afraid that 2023 is going to very closely resemble 1932
“Turn Those Machines Back On!”
- Changing Places movie
Planned.
A LOT of people are hanging their hats on November. There's a substantial amount of hope that we'll at least be able to stem the bleeding. Rarest wife counts among those folks.
I don't have the heart to tell them that the fix is in.
It’s not stagflation, it’s starveflation. I hope I still like canned soup and sardines in 2023.
Our society is nine meals from anarchy, per this writer:
https://internationalman.com/articles/nine-meals-from-anarchy/
Careful.
This is a much different “market”.
2nd quarter is July numbers.
I think people are already reeling from inflation and when they increase the interest rate again, people are going to start reacting badly.
5%-ish mortgage rates already which is pretty much where they should have been all along.
Credit Card rates are killers right now and will go higher. Unfortunately, people are using their cards right now to survive already.
Business lending will halt. I do not see how any small business will be able to absorb the rates.
We are watching history repeat itself in many ways, but the biggest hinderance is not going to be the World War we are entering into, it is going to be Biden’s domestic policies placing catastrophic burden on the United States. He is doing the exact opposite of what he should be doing given world events.
Basically, retailers have signaled the ‘spending spree’ has stopped, which is good. The consumer is no longer contributing to inflation. All that is left is what the government policies are, the supply-chain problems, China’s Covid policy, and the impending war. Biden could knockoff several of these issues with a domestic policy shift, but he stubbornly refuses to do so.
These failures will drag us into a depression and World War, where we could very well see the fall of the American dollar and the United States under the direction of Joe Biden. I do not for one second believe November is going to save us. The ‘red wave’ needs to be big enough to override White House vetoes. Republicans need to be confident enough to pass legislation, let it get vetoed, and then override Biden. Do we have that level of real courage? Cause otherwise ‘stemming’ the bleeding is not going to be enough.
Polls say 75% of America thinks we are on the wrong track, we have the wind at our backs if we put the sails up to use it.
I agree to be very careful in this current market.
We are going to witness a few companies crumble that we did not think would.
With everything ‘fake’ right now, the cards will fall it too many get pulled out.
Investment folks I follow are saying no one is safe. Everyone does see it coming, but no one is exactly sure where to run for cover.
The Communist Reset is underway.
I am buying for 3 year hold. By then Brandon will be gone.
Oh yes, the economy was high on covid stimulus and artificially low interest rates for ever. I received many thousands in stimulus checks, which we could have done without. By now that excess money has been spent by people. Add to that double digit inflation (that is what I am seeing at Lowe’s, HD, groceries, gasoline), and no wonder Target and Walmart are feeling the pinch in profits.
And I would add, they are the inexpensive goods retailers. If they are getting pinched it is a very bad indicator of what is happening in this business cycle.
Don't try to catch a falling knife.
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