Investing.com - Australian shares are expected to continue their decline on Tuesday, following a global sell-off driven by rising concerns that the US economy may be heading towards a recession. This wave of negative sentiment hit Europe before impacting an already jittery Wall Street.
ASX 200 Futures were last trading 2.5% lower. This follows a significant drop in the S&P/ASX 200 Index on Monday, which plummeted by 293.6 points, or 3.7%, to 7649.6. It was the most severe session for investors since the COVID-19 pandemic rattled markets in 2020, amid concerns that the US Federal Reserve has not cut rates quickly enough to avert a severe economic downturn.
In New York, the S&P 500 dropped 3% to 5186.48, the tech-heavy NASDAQ Composite fell 3.4%, and the Dow Jones Industrial Average shed 1033 points, or 2.6%. Wall Street’s “fear gauge,” the VIX, recorded its largest spike since data tracking began in 1990.
In commodities, copper, gold, and crude oil declined as global economic concerns dimmed the outlook for industrial demand, prompting traders to cash out of profitable positions.
Cryptocurrencies were also impacted, with Bitcoin falling 9.5% to US53,801.
On the bond markets, Australia 10-year and 2-year rates were at 3.885% and 3.54%, respectively.