U.S. stock futures climbed while Asian markets rebounded following a sharp global selloff on Monday.
The Nikkei Stock Average in Tokyo surged 10% on Tuesday, recovering from its worst one-day drop since the crash following Black Monday in 1987. Monday’s losses had rippled globally, with the S&P 500 experiencing its steepest decline since 2022.
Investors have been unwinding some of the year’s most popular trades in recent days, including a significant selloff in tech shares. This trend accelerated after recent economic data stoked concerns about the U.S. economy. On Monday, the “Magnificent Seven” group of tech giants collectively lost over $650 billion in market value.
Key Points Ahead of the U.S. Trading Day:
Futures tied to the S&P 500 rose over 1%. The broad index had dropped 3% on Monday, the Dow Jones Industrial Average fell 1,034 points, and the Nasdaq declined 3.4%.
South Korea’s Kospi index climbed over 3%, partially reversing its losses from Monday.
The yen, which has been a significant driver of market movements in recent days, retraced some of its gains, trading at around 145.25 to the dollar, compared with 142 to the dollar at its strongest point on Monday.
Financial advisers suggest sticking to a pre-determined plan rather than making impulsive decisions during market volatility.
Analysis
Jon Sindreu from “Heard on the Street” notes that sudden market selloffs, like the one seen in Japan on Monday, tend to be less hazardous than those that unfold gradually over time.
