Stock Market News: Nasdaq Futures Plummet Amid Global Selloff

by Jennifer

The Nasdaq Composite is spearheading declines in premarket trading on Monday, with futures for the index falling significantly as technology stocks drive the downward trend. This follows a steep market retreat on Friday.

Global equities are tumbling as concerns mount over a potential sharp slowdown in the U.S. economy, exacerbated by disappointing jobs data released last week. There is growing apprehension that any potential interest-rate cuts by the Federal Reserve might be insufficient to stimulate economic growth. Japan’s Nikkei index experienced its most severe one-day drop since 1987, underscoring the global nature of the selloff.

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Federal Reserve Rate-Cut Expectations Surge

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Market expectations have shifted dramatically over the past month. Initially, there was a high level of confidence that the Federal Reserve would not implement interest-rate cuts this year. However, current projections now anticipate up to five rate cuts by the Fed by the end of 2024, according to Saxo’s strategy team.

The team noted that the immediate market sentiment is largely influenced by risk management strategies being employed by institutional investors. Looking ahead, the medium-term outlook will hinge on forthcoming macroeconomic data. Despite current volatility, Saxo maintains a cautiously optimistic view on the economy, estimating the probability of a recession at no higher than 33% at this time.

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