The global stock market rout has intensified, with Japan’s benchmark index experiencing its worst day since Black Monday due to fears of a US recession.
Tokyo’s Nikkei 225 plummeted by 12.4%, marking its largest-ever point loss overnight and its most severe single-day drop since the notorious trading session in October 1987.
The index is on track for its worst two-day decline in history after falling 5.9% on Friday, driven by heavy selling as investors worried that the American economy might be in worse condition than anticipated.
European and US markets are expected to follow this trend when trading begins, as investors flock to safe havens such as the yen and Swiss franc.
Weaker-than-expected jobs and manufacturing data in the US have sparked concerns that the Federal Reserve may have delayed cutting interest rates too long, risking damage to the world’s largest economy.
Tan Boon Heng of Mizuho Bank in Singapore stated, “The feared scenario here is higher unemployment limiting spending, further reducing hiring and incomes, and leading to a recession.”
