London Daily

Focus on the big picture.
Sunday, Jul 05, 2026

US stocks sink deeper as markets tumble worldwide

US stocks sink deeper as markets tumble worldwide

Investors are increasingly worried about inflation, a war in Ukraine and China’s COVID-19 lockdowns.

Stocks tumbled to a 13-month low in a widespread selloff amid concern about the Federal Reserve’s ability to tame inflationary spirals without throwing the economy into a recession.

The slide in the S&P 500 topped 3%, while the Treasury curve steepened, with the gap between five- and 30-year rates hitting the widest since March. Investors are increasingly worried about the limits to Fed policy at a time when supply-chain disruptions pose a significant threat to inflation amid a ravaging war in Ukraine and China’s Covid lockdowns. Data Monday showed U.S. consumers project prices in three years to be higher compared with a month ago — a troubling sign for officials trying to keep longer-term expectations anchored.

Pandemic-era stars bore the brunt of the selling, with Cathie Wood’s flagship exchange-traded fund sinking about 10% and an ETF tracking newly public companies down the most since the onset of the pandemic. Bitcoin slipped below $32,000, falling more than 50% from its all-time high. The rout also spread to energy producers, easily the market’s strongest sector in 2022. The group plunged over 8% as crude slid. Big tech was not spared, with the likes of Tesla Inc., Amazon.com Inc. and Nvidia Corp. off by at least 5%. The Cboe Volatility Index spiked to its highest in two months.

Traders will be closely watching a host of central bank speakers this week after Chair Jerome Powell on Wednesday played down the option of 75 basis-point rate hike. Fed Bank of Atlanta President Raphael Bostic told Bloomberg Television he favors policy makers continuing to raise rates by half-point increments rather than doing anything larger. In a later interview with Reuters broadcast on Twitter, Bostic added that while he saw low odds for a 75-basis-point hike in the next several months, he’s “not taking anything off the table.”

The April consumer-price index report on Wednesday is the highlight of an otherwise quiet week for economic releases. Inflation is projected to have moderated on both a monthly and annual basis, partly reflecting a dip in gasoline prices that have since picked back up. While inflation likely peaked in March at 8.5%, the hottest in four decades, price pressures are expected to remain elevated, keeping Fed officials on track to steadily lift borrowing costs in the months ahead.

High inflation readings, a slowing economy and aggressive tightening by the Fed to rein in soaring prices have weighed on risk appetite and valuations. Even if an outright recession is avoided, the outlook for U.S. stocks isn’t particularly bright, according to Goldman Sachs Group Inc. strategists.

“Swings will remain large until the path of inflation is clarified,” strategists led by David Kostin wrote in a note to clients, adding that “tightening financial conditions and poor market liquidity make it difficult to argue for a short-term rally similar in size to the one in late March.”

Here are key events to watch this week:


*  Cleveland Fed President Loretta Mester, Atlanta Fed President Raphael Bostic, New York Fed President John Williams, Fed Governor Christopher Waller speak, Tuesday

*  Atlanta Fed President Raphael Bostic speaks, Wednesday

*  U.S. CPI, WednesdayEIA crude oil inventory report, Wednesday

*  San Francisco Fed President Mary Daly speaks, Thursday

*  U.S. PPI, initial jobless claims, Thursday

*  University of Michigan consumer sentiment, Friday

Some of the main moves in markets:


Stocks

*  The S&P 500 fell 3.2% as of 4 p.m. New York time

*  The Nasdaq 100 fell 4%

*  The Dow Jones Industrial Average fell 2%

*  The MSCI World index fell 3.1%

Currencies

*  The Bloomberg Dollar Spot Index rose 0.3%

*  The euro was little changed at $1.0559

*  The British pound fell 0.1% to $1.2333

*  The Japanese yen rose 0.3% to 130.22 per dollar

Bonds

*  The yield on 10-year Treasuries declined 10 basis points to 3.03%

*  Germany’s 10-year yield declined four basis points to 1.09%

*  Britain’s 10-year yield declined four basis points to 1.96%

Commodities

*  West Texas Intermediate crude fell 6.8% to $102.28 a barrel

*  Gold futures fell 1.6% to $1,852.70 an ounce

Newsletter

Related Articles

0:00
0:00
Close
Morocco and France Advance as 2026 FIFA World Cup Enters Quarterfinals.
Historic 2026 Tour de France Opens in Barcelona With Revamped Team Time Trial.
Global Mergers and Acquisitions Approach $4 Trillion Defying Geopolitical Tumult.
Negotiators Advance 20-Point Framework for Gaza Ceasefire and Demilitarization.
OECD Warns Middle East Conflict Will Depress Global Economic Growth.
Ukrainian Drones Strike Major Oil Terminal in St. Petersburg.
World Meteorological Organization Issues Urgent Alert Over Rapidly Intensifying El Niño.
United States Commemorates 250th Anniversary With Diplomatic Summits and Global Flotilla.
Iran Begins Days-Long Funeral for Supreme Leader Khamenei Amid Strait of Hormuz Standoff.
Technology giant reports surging carbon emissions driven by artificial intelligence infrastructure demands.
Artificial intelligence adoption accelerates workforce reductions across the technology and financial sectors.
Global technology and financial conglomerates collaborate to launch a new stablecoin standard.
United States regulators lift export restrictions on a major frontier artificial intelligence model.
Royal Society Exhibition Highlights Growing Focus on Public Trust in Science
Energy Costs and Supply Chain Risks Continue to Shape UK Business Strategy
Rapid Rise in Artificial Intelligence Adoption Reshapes UK Corporate Operations, ONS Says
UK Businesses Turn Defensive as Economic Outlook Weakens, Institute of Directors Data Shows
UK Government Faces Criticism Over Late Extension of Pub Hours for England Match
Inquest Continues Into Death of Noah Donohoe as Jury Deliberates Findings
Calls for Stronger Wildlife Attraction Safety Rules After Crocodile Enclosure Injury
City Fire Under Control After Major Blaze Sends Smoke Across Urban Area
Police Investigation Continues After Officer Killed During Road Closure Duties
Blackpool Hotel Fined £120,000 After Electric Shock Incident Involving Child
Whistleblowers Allege Delays in UK Special Educational Needs Support Services
Calls Grow for Improved Support for UK Armed Forces Personnel Facing Health Conditions
Rising UK Energy Price Cap Increase Prompts Wider Concerns Over Household Pressures
UK Businesses Remain Concerned Over Global Conflict Risks to Supply Chains, ONS Finds
Office for National Statistics Reports Rising Adoption of Artificial Intelligence Across UK Businesses
Institute of Directors Reports Deepening Pessimism in UK Business Confidence Index
England Prepare for World Cup Round of 16 Match Against Mexico in Mexico City
Royal Society Summer Science Exhibition Concludes in London After Week-Long Showcase of Research
Silverstone Hosts British Grand Prix as Lando Norris and Lewis Hamilton Lead Home Crowd Expectations
Cornwall Van Dwellers Face Homelessness Risk as Council Tightens Enforcement
Police Investigate Stabbing of Iranian Journalist in London
Rare Copy of US Declaration of Independence Discovered in UK Archive
Department for Education Data Shows Persistent Literacy Gap Among Disadvantaged White Pupils
London Casino Faces Legal Action Over Alleged Tip Distribution Practices
England Records Hottest June on Record as Heatwave Disrupts Services Nationwide
UK Foreign Office Ends Overseas Education Programme for Women and Girls After Shortfall
UK Lawmakers Call for Urgent Action to Preserve Historic Outdoor Lidos
Police Criticise Extended Pub Opening Hours for England World Cup Fixture in Mexico
UK Safety Authorities Warn Parents Over AI-Generated Child Abuse Imagery Risks
Reform UK-Led Council Struggles to Attract Sponsors for Union Flag Promotion Scheme
OpenAI UK Investment Uncertainty Grows After Reported Setback on Stargate Data Centre Site
British Medical Association Warns of Severe Financial Crisis and Possible Staff Cuts
UK Devolution Debate Intensifies as Celtic Nations Prepare Breakup Contingency Plans
Starmer Signals Labour Transition as Burnham Emerges as Potential Successor
UK Government Consults International Partners on Maritime Trade Security and Energy Market Stability
Rare Revolutionary-Era Documents Discovered by UK Archives and Undergoing Authentication
UK Consumer Confidence Remains Deep in Negative Territory as Household Spending Stays Cautious
×