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Hawkish ECB Causes Nasdaq 100, Dow Jones And S&P 500 To Sink

  • Nasdaq 100 and other tech stocks fall amid a hawkish ECB
  • The ASX 200 continues to be vulnerable to lockdowns in China, slowing global growth.
  • Analysts looking at China’s CPI data and whether it will keep the People’s Bank of China on its toes in the midst of stimulatory measures.

Consensus further deteriorated on Wall Street, reflecting on Thursday’s investing session. The major base stock indexes had their worst performance since 18th May 2022. Notably, the Nasdaq 100, Dow Jones and S&P 500 fell 2.7%,1.9% and 2.4%, respectively. 

Until recently, the European Central Bank (ECB) was considered a dovish central bank. However, President Christine Lagarde downplayed this notion amidst increasing inflationary pressures.

The ECB heightened inflation expectations and, at the same time, downgraded the growth forecasts. It plans to help asset purchases in July and increase interest rates. 

With the bank taking a hawkish side, this means fears about liquidity draining from financial markets and rising bond yield, which undermines the risk-sensitive assets. 

The tech sector was one of the worst performing in the S&P at -2.38% by close of trading on Thursday. Materials, Utilities, Financials, and Communication Services followed suit.

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  • Phyllis Wangui

    Phyllis Wangui is a Financial Analyst and News Editor with qualifications in accounting and economics. She has over 20 years of banking and accounting experience, during which she has gained extensive knowledge of the forex, stock news, stock market, forex analysis, cryptos and foreign exchange industries. Phyllis is an avid commentator on these topics and loves to share her insights with others through financial publications and social media platforms.

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