Global markets see weakness triggered by recession fears in the US

Global markets on Friday saw weakness, with Asian markets being hit the hardest. Despite the possibility of a future rate cut, the lackluster growth has raised concerns about a recession. During the week, markets rallied in the run-up to the Fed meeting. However, recent data from China and the U.S. has raised fears about global growth.

On Thursday, the NASDAQ saw a sharp fall of 2.3%, while the S&P 500 ended the session lower by 1.37%. A slowdown in tech earnings has resulted in growing worries about future growth prospects in the industry. Additionally, U.S. factory data showed that manufacturing activity in the U.S. has contracted in the past month, while the 10-year U.S. Treasury Bill yields saw their biggest one-day fall on Thursday.

European markets stumbled on Thursday as well, with Germany announcing weak factory data and renewed weakness across Europe. Germany’s DAX and France’s CAC 40 fell over 2% at the end of Thursday’s session. Earlier this week, data from China also revealed that manufacturing activity in the country contracted for the first time in 9 months. China’s economy has been under pressure as low demand and consumption have affected manufacturing activity as well.

Meanwhile, Japan’s Nikkei 225 was hit the hardest and was trading lower by nearly 5% on Friday. The benchmark index had seen considerable losses in the previous session as well. The sell-off in the Japanese market was triggered following the Bank of Japan’s decision to hike interest rates to support the weak yen. On Friday, the KOSPI was trading lower by over 3%, while the Hang Seng saw losses of over 2%.

Following global cues, the Indian markets opened lower, with the benchmark index Nifty 50 trading lower by nearly 1%. The upcoming non-farm payroll data will give further insights into the U.S. economy. Additionally, traders and investors will be keeping an eye out for inflation data from South Korea.