US Federal Reserve and the Fear of A Second Wave of Corona have Caused the US Leading Index Dow Jones
At the beginning of the week, the Dow Jones index had climbed to its highest level since the start of the corona pandemic – now a Fed economic forecast caused prices to plummet. In the end, the biggest daily loss since March.
A dark economic assessment by the US Federal Reserve and the fear of a second wave of corona have caused the US leading index Dow Jones Industrial to fall by 6.90 percent to 25,128.17 points. He found himself at the level of the end of May. This was the largest percentage daily loss on a closing price basis since March. In the meantime, the Dow would have almost dropped below the 25,000 mark.
It was only at the start of the week that the Dow climbed to 27,580 points, the highest level since the end of February. That was an increase of more than 50 percent since the Corona crash low in March.
Fed chairman Jerome Powell had come up with clear words in the middle of the week in view of the severe economic crisis resulting from the corona pandemic: A significant proportion of the job losses in the US are likely to be permanent.
In addition, there were new infection numbers: In some southern US states such as Florida and Texas, new infections rose again. The British analyst house Pantheon said that some corona restrictions are expected to be reintroduced in some cities or states.
No fewer stock exchange traders had already spoken of an overheating of the market due to the flood of cheap money from the central banks, which no longer had anything to do with the real economic outlook. The tech-heavy Nasdaq 100 had even climbed to a record high and now fell 5.01 percent to 9,588.48 points.