EconomyFirstFT: Nasdaq tumbles 5% in sharpest fall since 2020

FirstFT: Nasdaq tumbles 5% in sharpest fall since 2020

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Wall Street stocks suffered steep declines yesterday in an abrupt reversal from a rally in the previous trading session, with the Nasdaq registering its biggest fall since 2020.

The Nasdaq Composite, which comprises many of the largest US technology companies, fell nearly 5 per cent in early afternoon trading in New York, the heaviest intraday drop since September 2020.

The blue-chip S&P 500 index also suffered a sell-off, sliding 3.4 per cent. Every large sector was in the red, with industries including consumer discretionary and technology companies among the biggest fallers. Shares of some of corporate America’s biggest names lurched lower, with Amazon down 7 per cent, Tesla sinking 8 per cent and Apple dipping 5 per cent.

The Federal Reserve, the world’s most influential central bank, raised its main interest rate by 0.5 percentage points on Wednesday, the biggest increase since 2000, as it attempts to tame intense inflation. Jay Powell, the Fed chief, sent a strong signal that the US central bank is likely to raise rates by the same amount at its next two meetings.

Powell’s remarks were at first perceived as dovish, especially after he appeared to take the possibility of a 0.75 percentage point rise off the table for this year. Stocks subsequently rose on Wednesday, with the S&P recording its best day since May 2020.

“You’ve got more tightening along the road, so there’s no reason to buy the dip in equities. There’s also no reason to buy bonds at this level because it doesn’t look like inflation is going anywhere,” said Tom di Galoma, managing director at Seaport Global Holdings.

Thanks for reading FirstFT Asia. Here’s the rest of the day’s news. — Sophia

1. Ellison, Binance and Sequoia back Musk’s $44bn bid for Twitter Elon Musk has raised $7.14bn of funding for his $44bn buyout of Twitter, from investors including Oracle co-founder Larry Ellison, crypto exchange Binance and asset management groups Fidelity, Brookfield and Sequoia Capital. Binance chief executive Changpeng Zhao said his crypto exchange would offer “blank cheque” support for Musk’s takeover of Twitter.

2. Exclusive: Archegos considered becoming biggest Deutsche Bank shareholder Archegos Capital Management considered becoming the largest shareholder in Germany’s biggest lender before the family office run by co-founder Bill Hwang imploded in 2021. According to two people familiar with the matter, Archegos received information about a controlling stake owned by Chinese conglomerate HNA that was in trouble and later collapsed.

3. Covid lockdowns hammer China’s services sector More signs of economic slowdown in China yesterday. An index that measures activity in China’s services sector suffered its second-biggest fall on record as President Xi Jinping’s zero-Covid policy curtails economic activity.

4. Russian forces usurp Ukrainian internet infrastructure In a renewed offensive on the southern Donbas region, a fibre optic cable in the city of Kherson was taken offline and rerouted to Russia-controlled operators, making Ukrainians’ data vulnerable to interception and censorship by the Kremlin.

5. Hikvision shares plunge after US threatens sanctions The Chinese surveillance camera maker’s share price fell 10 per cent yesterday after the Biden administration began laying groundwork to impose hard-hitting sanctions on the company. Washington has accused Hikvision, which is the world’s largest manufacturer of surveillance equipment, of facilitating human rights abuses.

The days ahead

Quarterly results A batch of quarterly earnings statements are released today, from Adidas, Beazley, International Airlines Group and ING.

Miami Grand Prix The 2022 Formula One season continues with the Miami Grand Prix in the United States on Sunday.

Victory in Europe Day Sunday marks the 77th anniversary of the end of hostilities in Europe in the second world war.

Mother’s Day Many countries worldwide celebrate Mother’s Day on Sunday.

Less than 48 hours until you can hear Henry Kissinger, Chimamanda Ngozi Adichie and more at our inaugural US FTWeekend Festival, this Saturday in Washington DC. We look forward to exploring the global perspective on the ideas and issues of the day, with an array of thinkers, writers, artists, chefs, performers and more. As a newsletter subscriber claim an exclusive limited time offer of 50% off your pass using promo code FTNewslettersxFTWF22.

What else we’re reading

Russian economy could weather the impact of an EU oil ban Brussels proposed a measure on Wednesday that would ban all imports of Russian oil by the end of the year. The plan carries political heft, but some analysts believe it will not deliver the intended blow to Russia’s economy. Prices for crude have risen substantially, counteracting the costs of losing the European market.

How Rivian’s CEO became the anti-Elon The electric truckmaker’s RJ Scaringe has no interest in Mars, or rockets, or building tunnels, or Twitter, either to use or to own. The tall and athletic 39-year-old has shied away from using the Elon Musk playbook in his battle with Ford and Tesla.

The man who would replace Erdoğan If there were any doubts about Kemal Kılıçdaroğlu’s determination to take on Turkey’s president, Recep Tayyip Erdoğan, they were dispelled last week. With a critical election due within the next 13 months, he warned unnamed rivals within his opposition alliance: “Either join me or get out of my way.”

No let-up in North Korea’s two-year Covid lockout Kim Jong Un reacted decisively to the emergence of coronavirus in early 2020, sealing borders with China and Russia, tightening restrictions on internal movement and ejecting foreign diplomats and aid workers. And while Pyongyang’s claims that it has not recorded a single Covid case have been widely ridiculed, experts say no evidence has emerged of any large-scale outbreaks.

  • More Covid-19 news: The World Health Organization estimates that 15mn people died by the end of 2021, which is nearly three times higher than the official death toll.

The executives who “eat their own dog food” The act of testing your own product or service, otherwise known as “dogfooding”, is spreading from software development to other industries. Leadership and staff who take on frontline shifts in roles such as customer service or food delivery gain empathy — and valuable insights on how to improve their business.


Daniel Humm, one of the world’s top chefs, has called New York City home for the past 15 years. Living where he does means he never runs short on inspiration for his two great passions: food and art. Humm shares his jam-packed itinerary for a perfect day in New York, taking on chess hustlers, catching Daniel Craig in “Macbeth” and sampling exquisite Japanese plant-based cuisine.

David Humm, top chef and chess player © Cole Wilson

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