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22.05.2025 01:01 PMIndices: The Dow plunged 1.91%, the S&P 500 dropped 1.61%, and the Nasdaq fell 1.41%. Wolfspeed tumbled following reports of a potential bankruptcy. Target sank after cutting its full-year sales outlook. UnitedHealth declined amid revelations of secret payments and a downgrade from HSBC. Meanwhile, US President Donald Trump's proposed tax and spending plan is projected to add $3.8 trillion to US national debt.
Wall Street shaken: biggest one-day drop in a month
US equity markets closed the session with a sharp sell-off. All three major indices posted their worst daily performance in the past 30 days. Small-cap stocks were hit particularly hard, with the Russell 2000 recording its steepest loss since April 10.
Bonds under pressure as yields surge
Investor demand faltered in the latest $16 billion auction of 20-year Treasury bonds, pushing yields sharply higher. The yield on the 10-year US Treasury rose by 10.8 basis points to 4.589%, notching its highest level since February.
Politics heats up economy: Congress in the spotlight
In the US House of Representatives, Republicans are holding emergency hearings to resolve internal disputes over proposed budget cuts. At the center of the debate is the future of the Medicaid program. Independent analysts estimate that the proposed measures could add between $3 trillion and $5 trillion to the already record-high national debt of $36.2 trillion.
Major US stock indices face sharp sell-off
Most sectors in the red
Out of the 11 S&P 500 sectors, 10 finished lower. The steepest declines came from real estate, healthcare, financials, utilities, consumer goods, and technology. The only sector to post gains was communications.
Tech mixed: Google gains while other giants falter
Amid broader market volatility, shares of Alphabet, Google's parent company, rose 2.7%, showing rare resilience in a broadly negative session. The rest of the tech giants did not fare as well: Nvidia dropped 1.9%, Apple fell 2.3%, and Tesla slid 2.7%.
UnitedHealth shares plunge amid healthcare scandal
UnitedHealth Group stock plunged nearly 6% following an investigation by The Guardian into secret bonus payments to nursing homes, allegedly aimed at reducing hospital admissions. The blow was compounded by HSBC, which downgraded the stock from "hold" to "sell."
Weak consumer: Target revises outlook
Target shares tumbled 5.2% after the company slashed its full-year forecast. The retailer cited a downturn in discretionary spending, signaling a broader decline in consumer confidence.
Wolfspeed on the brink of collapse
Semiconductor maker Wolfspeed plunged nearly 60% following reports of a potential bankruptcy. Insider sources indicate a formal filing could come within weeks.
Rates climb, outlook remains uncertain
The S&P 500 has surged more than 17% since the April correction, defying geopolitical and economic headwinds, including the potential reintroduction of Trump-era tariffs.
Morgan Stanley rates US market as 'above average,' citing resilient global growth
Morgan Stanley has upgraded its view on the US equity market to "above market." The bank's analysts argue that, despite political risk, global economic growth remains intact, albeit at a modest pace.
Trump's tax bill alarms investors
On the horizon is a key vote in the House of Representatives on Donald Trump's new tax proposal. Experts warn that the move could add $3.8 trillion to the US national debt, which already stands at $36 trillion.
Europe under pressure: market opens with gloomy tone
European equity futures opened on a downbeat note, mirroring jitters from Asian trading. Investors remain cautious ahead of the release of May's business activity indices. These figures will shed light on how European firms are coping with global economic uncertainty.
Compass points to instability: businesses struggle for footing
May surveys on services and manufacturing activity, eagerly awaited by markets, may offer clarity on how exposed European companies are to geopolitical and trade risks, especially given the region's reliance on external demand.
US losing its luster for investors
Amid mounting fears of a potential global recession triggered by former President Donald Trump's trade policies, investors are increasingly looking beyond US borders for safer alternatives. Demand for American assets has notably weakened, highlighted by the poor $16 billion auction of 20-year Treasuries.
Yields climb, nerves fray
Weak demand for US debt pushed yields on 20- and 30-year Treasuries higher. The latter have now stabilized above 5%, stoking further anxiety in the markets. Signs of strain in the bond market are becoming increasingly apparent, not just in the US.
Japan under pressure: sell-off hits hard
Japanese bonds are facing intense selling pressure. The yield on 30-year JGBs reached 3.155%, just shy of the 3.185% record set in the previous session, underscoring the scale of the current bond rout.
Asia in the red: Yen squeezes Nikkei
Asian equity markets also ended in negative territory. The MSCI Asia-Pacific ex-Japan index slipped 0.6%, while Japan's Nikkei 225 dropped 0.8%, dragged down by a strengthening yen that is eroding the competitiveness of Japanese exporters.
