The Wall Street S&P 500 fell 2.4%, pushing it more than 20% below the all-time high set in January, a decline commonly referred to as the bear market. The US stock index had fallen for a while at the end of May, before recovering from its lows. Nasdaq Composite, which is heavy on technology, fell 2.9%, bringing its losses for the year to about 30%. The speculative market corners have suffered severely this year as central banks in the US and Europe begin to raise interest rates and drain liquidity from the financial system. Bitcoin, the cryptocurrency that tends to react in the wider market climate, traded below $ 24,000, having fallen almost 20 percent since Friday. Analysts have raised their forecasts for how much the Federal Reserve will raise interest rates, with some speculating that the US Federal Reserve may implement a very large 0.75 percentage point increase in its monetary policy meeting this week. US consumer price inflation hit an unexpectedly high 8.6% year-on-year in May, according to data on Friday, as Russia’s invasion of Ukraine increased the cost of fuel and food. Money markets are now priced at 3.4 percent funded mutual funds by December, in the range of 0.75 percent to 1 percent at present. “I think with the latter [inflation] “The Fed will do it and it will cause a financial slowdown,” said Julian Howard, chief investment officer for multi-asset solutions at fund manager GAM. “Everything looks very bad in the short term and there is nowhere to really get out of it except to go for cash at the moment.” The yield on the 10-year government benchmark bond, which supports global borrowing costs, rose more than 3.29 percent to its highest level since 2011 as the price of the instrument fell. The yield on the two-year bond, which monitors interest rate expectations, rose 0.17 percentage points to 3.23%. US investment bank Goldman Sachs on Monday raised its Fed policy forecast to include 0.5 percentage point hikes this week and again in July, September and November, with further quarterly gains in December and January. . “There is very little chance the Fed will turn to support the financial markets until there is a trend of very significant financial frustrations,” said Seema Shah, chief strategist at Principal Global Investors. Barclays analysts forecast a 0.75 percentage point increase this week. Standard Chartered generals said in a research note that they would not “rule out” this result. In Europe, the Stoxx 600 stock index fell 2.1%, putting it on track for the fifth consecutive session with a fall. The regional stock index has fallen more than 9 percent this quarter. The yield on the 10-year Italian bond rose 0.19 percentage points to 3.94%, having more than quadrupled since mid-December. This came after the European Central Bank last week paved the way for its first interest rate hike in more than a decade. The pound fell 1.1 percent against the dollar to less than $ 1.22 as the US currency strengthened and worries about the UK economy. Economists are watching the Bank of England raise its key lending rate by 0.25 percentage points on Thursday, with increasing chances of a 0.5 percentage point rise, escalating fears of stagnant inflation. Meanwhile, the yen hit a 24-year low of 135 135.19 per dollar as traders bet on the Bank of Japan, which continues to defy the global trend towards higher interest rates. The FTSE index of Asian stocks outside Japan fell 2.8%.
