Market Update: Market Meltdown Screams Black Monday 2.0....

Well today, in things I’m zero percent surprised about… mayhem is absolutely sweeping the markets this Monday (Black Monday anyone?). Look, we've said it multiple times over the past few days but with nonfarm numbers and Jerome Powell not delivering on Fed cut promises, the market is making everyone pay today. 

(Source: Giphy) 

As of this morning, the Magnificent 7 stocks are tracking their 10th biggest market valuation decline ever as they make up roughly 43% of the Nasdaq 100’s weighting. And today, they’re collectively crashing faster than my diet during Sunday lunch as they are on pace to erase over $500 billion in market cap. Talk about a way to start the week amirite?

(Source: Yahoo Finance) 

For instance, we already talked about it this morning, buuuuut AI sugar daddy, Nvidia, is obviously taking the brunt of it. Shares plummeted as much as 13% at the open, paring losses to around 6% by mid-morning. Why? Well because like we mentioned, it turns out their next-gen AI chips are delayed by three months, potentially missing out on juicy sales to big players like Microsoft and Meta. 

(Source: Giphy) 

Gil Luria, D.A. Davidson’s senior software analyst, summed it up perfectly: “Nvidia has a window to sell to Microsoft, Amazon, Google, and Meta while those companies are hot and bothered about building out data centers as quickly as they can. That window will shut at some point.”

In addition, while Apple was one of the few tech stocks who ended Friday saying “Why so serious?” to everyone else, news of Grandpa Warren’s bad omen of a -50% cut in Apple shares caused the stock to plummet -4.14%. Tesla, Amazon, Microsoft, and Meta are all taking body shots as well as they are down -3.58%, -4.29%, -2.55%, and -2.88% on the day.

(Source: Reuters) 

So yeah the market is definitely in a horrific mood today. But it’s not just the U.S. markets feeling the burn - Tokyo’s Nikkei index finished Monday with a staggering 12% loss, its largest one-day drop since the infamous Black Monday of 1987. 

(Source: AP)

The VIX index, aka Wall Street’s volatility gauge, has also caught investors attention as it’s shot up by 170% since Friday. So in simple terms, if that doesn’t scream sh*t show… then buddy, I don’t know what to tell you. It’s legit madness out there. 

(Source: Giphy) 

With that said, this mayhem has traders now betting that there’s an 88% chance the Fed will cut benchmark rates by 50 basis points in September. However, to some even that may not be soon enough as Wharton’s finest, Jeremy Siegel, is calling for an emergency 75 point cut immediately as he basically said: “Hey Fed, how about you throw us a lifeline before we all drown?”

(Source: CNBC) 

Now I doubt the Fed will listen, but one can hope right? Regardless, the market is in full-on meltdown mode today. The Magnificent 7 are tanking, global markets are following suit, and everyone’s looking to the Fed for a miracle. 

(Source: Giphy) 

But hey, the rally was nice while it lasted. What goes up, must come down eventually, and unfortunately we’re definitely in the latter category today. In the meantime, stay tuned, stay calm, and please for the love of everything holy don’t check your portfolio too often. We all know once Jereome Powell pulls that money printer, it’ll be a different story for, pretty much, everyone. Until next time friends… 

(Source: Giphy) 

Stocks.News holds positions in Apple, Microsoft, Meta Platforms, Amazon, and Google as mentioned in the article.