Global markets experienced a tumultuous day, with the ASX, Wall Street, and cryptocurrency markets all witnessing significant declines. The Australian sharemarket opened sharply lower, mirroring the global trend, as Wall Street slumped and Bitcoin plunged, shedding roughly half its record price from last year. The S&P/ASX 200 dropped 1.5% in early trade, with 10 out of 11 industry sectors in the red, and only consumer stocks showing positive growth. Cryptocurrency markets were in full capitulation mode, with Bitcoin falling below $63,000 at one point, a stark contrast to its record high above $124,000 in October. This downward spiral has resulted in a $2 trillion loss for the global crypto market since its peak in October, with $800 billion wiped out in the last month alone.
Financial stocks took a hit, with the big four banks retreating. Commonwealth Bank lost 1%, Westpac 0.6%, National Australia Bank 1.1%, and ANZ Bank 1%. Fintech giant Block, exposed to the crypto market, shed 6.2% in early trade. Mining stocks showed mixed results, with BHP and Fortescue losing 1.4% and 1.1% respectively, while Rio Tinto rose 0.8% after exiting merger talks with Glencore. Gold stocks also declined, with Northern Star losing 1.3% and Evolution Mining 2.7%. Silver player South32 lost 3.2% as precious metals markets continued to fluctuate.
Energy stocks dropped due to falling oil prices, with Iran's confirmation of negotiations with the US easing the risk of military conflict and supply disruptions. Woodside Energy and Santos both lost 1.2% and 1.9% respectively in early trade. Technology stocks fell sharply, with WiseTech, NEXTDC, and Xero dropping 4%, 3.9%, and 1.3% respectively, as sector concerns reverberated globally.
The global market turmoil extended to Wall Street, where the S&P 500 fell 1.2% in its sixth loss in seven days since hitting an all-time high. The Dow Jones dropped 592 points, and the Nasdaq composite sank 1.6%. Qualcomm, despite topping analysts' expectations, fell 8.5%. The bond market saw Treasury yields sink due to a jump in unemployment benefits, potentially signaling accelerating layoffs. Reports indicated a surge in layoffs by US employers, with the highest number since October.
In commodities markets, silver's price dropped 9.1%, and gold's price fell 1.2% to $4889.50 per ounce, swinging back and forth since its price nearly doubled over 12 months. Alphabet, the parent company of Google and YouTube, slipped 0.5% despite reporting stronger profits than expected, as investors focused on its spending on artificial intelligence.
London's FTSE 100 dropped 0.9%, France's CAC 40 fell 0.3%, and Germany's DAX lost 0.5% as central banks maintained interest rates. The Market Recap newsletter provides daily trading summaries, offering valuable insights for investors and traders.
