All three major American stock market indices continued their downward slide on Monday, amid growing expectations of significant rate hikes from the Federal Reserve and an emerging consensus among economists that the country is entering a recession.
The Dow Jones Industrial Average closed at 30,516.74, a drop of almost 900 points or 2.79% from the morning’s opening. At one point, shortly before closing, the index of blue-chip securities was down more than 1,000 points.
The Nasdaq Composite took a similar beating, closing at 10,809.23 down 530.80 points, or 4.68%. A similar story was unfolding over at the S&P 500, which closed at 3,749.63, down 151.23 or 3.88% on Monday.
Year-to-date charts show all three in near free-fall since last Wednesday.
The US markets’ downward slide began in May, after the Federal Reserve announced it would raise the key interest rate by 50 basis points and start selling off assets to combat runaway inflation. By May 22, stocks already had their longest losing streak since 1932, before the Great Depression.
Top economists are now predicting a recession by the end of the year, as gas prices soar and consumer confidence plummets. On Friday, the University of Michigan consumer sentiment gauge showed 50.2 points, a record low.
Meanwhile, the price of gas at the pump reached the national average of $5 a gallon on Saturday, an all-time high.