FirstFT: Global stocks suffer worst day since June 2020

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Investors dumped assets across the board yesterday as they grappled with the economic fallout from rapidly rising US interest rates and slowing economic activity alongside the most brutal military conflict in the world. Europe since World War II and the resurgence of Covid-19 in China.

The FTSE All-World Barometer of global stocks fell 3%, its biggest drop since June 2020. Wall Street’s S&P 500 index fell 3.2% and the tech-focused Nasdaq Composite fell by 4.3%.

The energy sector was also swept by sales, with Brent, the international benchmark, falling nearly 6% as investors worried about the outlook for the global economy.

New data yesterday from China showed export growth fell to its lowest level in two years in April. It follows weaker data last week from Germany and France, the EU’s two biggest economies, showing that factory orders slowed more than expected in March.

The sell-off in the bond market also continued, with the yield on 10-year US government bonds rising above 3.2% before falling back.

Bitcoin continued its steep declines. The world’s most actively traded digital token fell below $30,000 for the first time since July and is down more than 50% from its November peak.

Emerging market currencies also came under pressure from the rising dollar and slowing economic activity in China. The Chinese renminbi fell to its weakest level against the dollar in more than 18 months yesterday.

But it looks like there may be a pause in selling today after five straight weeks of falls on Wall Street – the worst losing streak since 2011.

Futures following the S&P and Nasdaq 100 gauges pointed to a higher open on Wall Street today. This was after European shares, which fell 2.9% yesterday, remained flat in the morning session while the Hang Seng index in Hong Kong recovered its first losses and moved into positive territory during of the afternoon session.

  • Market overview: Richard Bernstein wonders if the current real fed funds rate will slow the economy, let alone dampen inflation.

Thanks for reading FirstFT Americas. Here’s the rest of the news from the day — Gordon

1. The Fed warns that the sharp rise in interest rates poses a risk to the American economy A sharp rise in interest rates would pose a risk to the US economy, the Federal Reserve said yesterday in its latest financial stability report. The US central bank also warned that consumer finances could be hit by job losses, higher interest rates and lower house prices in the half-yearly update.

2. Ukraine improves its war aims as confidence grows Ukraine has improved its war aims and seeks to push Russian forces out of the country as long as Western allies quickly deliver promised heavy weapons, Foreign Minister Dmytro Kuleba told the Financial Times.

3. The world is on track to cross the 1.5°C warming threshold within five years There is a 48% chance that the Earth’s annual temperature will exceed 1.5C of warming, above pre-industrial levels, in one of the years by 2026, the World Meteorological Organization has said and the UK Met Office in a report released today. .

4. Grindr to go public in Spac deal The gay dating app plans to go public through a merger with a special-purpose acquisition company that would give it an implied valuation of $2.1 billion. Grindr will receive $384 million in proceeds from the deal with Tiga Acquisition, a Spac created by Ashish Gupta in 2020.

5. A painting by Andy Warhol representing Marilyn Monroe sold for a record Andy Warhol’s iconic screen-printed portrait of Marilyn Monroe, ‘Shot Sage Blue Marilyn’, sold for $195 million at Christie’s last night. The price was a record for a work by an American artist and the highest price ever paid for a 20th century work of art.

‘Sage Shot Blue Marilyn’ by Andy Warhol at Christie’s. The work was considered a trophy by collectors © Sarah Yenesel/EPA-EFE/Shutterstock

The day ahead

FT Future of Cars Summit Tesla Chief Executive Elon Musk will virtually attend the FT Annual Automotive Conference today. He will speak and answer questions from the audience. Register here for a digital pass.

Company income Barry McCarthy will deliver his first set of quarterly results as chief executive of Peloton, the connected fitness company. Warner Music, Coinbase, Occidental Petroleum, Electronic Arts and Wynn Resorts are also reporting results.

Monetary Policy Raphael Bostic and Loretta Mester, chairs of the Atlanta and Cleveland branches of the Federal Reserve, respectively, will each discuss monetary policy at the Atlanta Fed’s financial markets conference in Florida. Minneapolis Fed President Neel Kashkari will participate in a discussion with Fed Governor Christopher Waller in Minnesota. New York Fed President John Williams will speak at an economic symposium in Germany.

Queen’s Speech Queen Elizabeth will miss the opening of Parliament for the first time in almost six decades. Her eldest son Prince Charles will read the speech for her, setting out the UK government’s legislative agenda for the next year.

South Korean leader inaugurated Debate over whether South Korea should adopt US nuclear weapons on the Korean Peninsula – and even whether it should seek to develop its own nuclear deterrent – ​​has dominated the build-up to Yoon Suk’s inauguration today. -yeol.

What else we read and listen to

Bored Ape creator’s next bargain The startup behind Bored Ape Yacht Club, the non-fungible digital art token collection snapped up for millions by celebrities and crypto enthusiasts, has an ambitious new idea: sell plots of virtual terrain in its own metaverse, an alternative to platforms built by Silicon Valley companies such as Apple and Meta.

Henry Kissinger: “We now live in a totally new era” The Cold War strategist discussed Russia, the war in Ukraine and China at the FT Weekend Festival in Washington last weekend. Find the full transcript of Kissinger’s interview with the FT’s Edward Luce and watch it here.

New Zealand’s jobs law will cause ripples beyond its shores Legislation pending in New Zealand’s parliament aims to improve bad jobs by setting a minimum floor for wages and conditions. Sarah O’Connor says the bill represents a huge shift in the labor market – and its success or failure will impact the whole world.

Money Clinic: How can I increase my side business? A year ago, 24-year-old Evvia started a vintage knitwear business from her bedroom. Today, her brand Loupy Studio has more than 40,000 followers on Instagram and she receives orders from all over the world. The business has been so successful that Evvia is going to have to cut the number of hours she spends on her day job, but she wonders how that might fit together financially. FT editor Claer Barrett offers advice for the budding entrepreneur.

The Enduring Fascination of the “Power Spouse” Movies and books are often dedicated to telling the stories of the rich and powerful. But their spouses can be just as fascinating, writes Emma Jacobs. Otherwise, how to explain the newspaper soap opera reporting gossip about Meghan Markle and Carrie Johnson?

What to watch

Explore the best in TV and streaming this week, from hard-hitting French drama Oussekine for Our fathera nightmarish story of a doctor who played god, modern dating explored in Love life and more.

Sayyid El Alami as Malik Oussekine

Sayyid El Alami in the role of Malik Oussekine © Jean-Claude Lother

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