Market Update :Oops! Dow Jones Witnesses A Steep Decline. What Now?

  • Dec 05, 2018 AEDT
  • Team Kalkine
Market Update :Oops! Dow Jones Witnesses A Steep Decline. What Now?

It seems like the market would continue to haunt the investors about the downturn in the global economy. Just a day after the markets witnessed a rise and which helped in regaining some of the confidence of the investors, the Dow Jones witnessed the huge decline which again raises tensions about the health of the global economy. On December 4, 2018, Dow Jones Industrial Average ended the session at 25,027.07 which implies the substantial fall of 799.36 points or 3.10%. Needless to say, the stock prices of the technology giants also witnessed the huge fall. Facebook (NASDAQ: FB) and Apple Inc. (NASDAQ: AAPL) ended the session on December 4, 2018 by declining 2.24% and 4.40%, respectively. However, other technology giants like Amazon (NASDAQ: AMZN), Netflix (NASDAQ: NFLX) and Alphabet Inc (NASDAQ: GOOGL) closed the session by falling 5.87%, 5.16% and 4.83%, respectively.

Even though the trade battle between the US and China has been put to a temporary halt for the period of 90 days, the investors are still worried that the battle has not come to a permanent end. The market players are concerned about what could happen if the outcome after the 90 days is not positive. As the market players are already aware, if the trade battle escalates from this level, it could pose a serious threat to the global economy. The escalation in the battle would also make the investments for the investors difficult. These types of geopolitical disturbances have the potential to derail the growth of the global economy.

Oil Prices Also Falls: Key Insights

It seems like the oil prices walk on the steps of the global markets. The oil prices witness a decline mainly because the stock markets witnessed the negative momentum as the investors are still worried about the escalation of the trade battle. The strong downward momentum in the equities increases the worries related to the economic slowdown. Additionally, the tensions related to the decline in the oil demand is also looming over the minds of the investors. It seems like the investors are now left with the only hope about the meeting in which the production cuts would be discussed. The reduction in the supplies is very important considering the decline in oil prices. It is expected that after the production cuts are announced, the oil prices might recover which could lead to a rise in the investors’ sentiments.

Australian Markets Ends Lower

As strong downtrend was witnessed in the Dow Jones and the concerns related to the slowdown of the economy has again increased there was a highly probability that the Australian markets would end the day on the negative note. On December 5, 2018, S&P/ASX200 ended the session at 5668.4 which implies a fall of 44.7 points or 0.8%. Talking about the gainers, Trade Me Group Limited (ASX: TME) and APA Group (ASX: APA) ended today’s session by advancing 3.509% and 3.448%, respectively. On the other hand, Lynas Corporation Limited (ASX: LYC) and Nine Entertainment Company Holdings Limited (ASX: NEC) closed today’s session by witnessing the fall of 22.406% and 7.955%, respectively.

However, the managing director as well as chief executive officer of the Bank of Queensland (ASX: BOQ) have decided to step down. Read the full news here. Also, Trade Me Group Limited had got the proposal from Hellman & Friedman in regard to the acquisition of the shares of TME. Read the full news here.


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