New York stock market falls all at once, investment sentiment weakens due to stagflation concerns due to US GDP shock

[비즈니스포스트] The major indices of the New York stock market fell all at once. Investment sentiment worsened as concerns about stagflation (increasing prices amid an economic recession) arose.

At the New York Stock Exchange (NYSE) on the 25th local time, the Dow Jones Industrial Average ended trading at 38,085.80, down 375.12 points (0.98%) from the previous day.

 

The Standard & Poor’s (S&P) 500 index, centered on large-cap stocks, closed at 5,048.42, down 23.21 points (0.46%) from the previous day, and the Nasdaq index, centered on technology stocks, closed at 15,611.76, down 100.99 points (0.64%).

The major indices, which started falling sharply, ended trading with the intraday decline narrowing.

Kim Ji-hyeon, a researcher at Kiwoom Securities, said, “The U.S. stock market showed a 1% plunge in the early trading period due to the possibility of stackflation due to GDP and inflation shocks in the first quarter and a slump in Meta stock prices,” adding, “Afterwards, the decline was reduced by paying attention to the performance season of major big tech companies.” “We narrowed it down and completed the transaction,” he analyzed.

The stock price of Meta (-10.56%), which announced its earnings after the market closed the previous day, plummeted, leading to the index’s weakness. Meta reported good performance in the first quarter, but its stock price fell significantly as its performance forecast for the second quarter fell below market expectations.

Economic indicators also worsened investor sentiment.

The United States’ first quarter gross domestic product (GDP) was calculated to have grown by 1.6% (annualized rate) compared to the previous quarter. It was significantly below the previous quarter (3.4%) and market forecast (2.5%). The sluggishness of major items such as private consumption and government spending led to the GDP shock in the first quarter.

Meanwhile, as the price index showed an upward trend, concerns about stagflation increased. Core personal consumption expenditures (PCE) in the US in March were 3.7%, exceeding the fourth quarter (2.0%) and the market forecast (3.7%).

Looking at each stock, Alphabet (-2.0%)’s stock price is soaring more than 10% in after-hours trading as it announced good earnings and its first-ever dividend payment plan after the market closed.

Nvidia (3.7%) and Tesla (-5.0%) stock prices rose. Reporter Jeong Hee-kyung