The S&P 500 lost almost 3% at the start of the session. European stocks also fell and Asia had a bad day.
Retirement Wednesday occurred the day after the S&P 500 peak. Although still far from a February 19 record, stocks in the United States have risen steadily in recent weeks as investors have begun to focus on the prospect of ” a possible rebound from the economic collapse triggered by the pandemic.
But on Wednesday, they were confronted with a number of reports that underscore how bad the economy is. Department of Commerce said retail sales in March fell 8.7 percent were forced to stay at home, and the Federal Reserve said industrial and manufacturing production in the United States had fallen the most since 1946.
The German Ministry of Economy, the economic output of Europe’s largest economy, is expected to plunge by almost 10% from April to June.
When reporting their profits, the country’s banks also issued more warnings about the possibility of a wave of loan defaults, saying they are storing cash for losses. Citigroup and Bank of America shares fell after these reports.
Oil producers also fell sharply on Wednesday following a further drop in crude oil prices. Despite historic deal reached over the weekend by OPEC members and Russia to cut production, the global oil market remains overwhelmingly surplus, with further price cuts possible, the International Agency announced on Wednesday. Energy.
The agency predicts that global oil demand will drop by about a third this month, or 29 million barrels a day, due to the effects of the coronavirus pandemic, while supplies will remain high due to the increased production during the ending price war between Saudi Arabia and Russia.