Wall Street experienced a major selloff, heavily led by premium technology shares. The tech-heavy Nasdaq Composite plunged 4.2 percent, while the S&P 500 lost 2.64 percent and the Dow Jones Industrial Average dropped 1.4 percent. The aggressive downturn was triggered by fresh economic data showing US employers added far more jobs than anticipated. This unexpectedly robust labor market immediately fueled investor bets that the US Federal Reserve may have to implement further interest rate hikes before the end of the year to curb potential inflation.
In response to the jobs data, US Treasury yields surged dramatically. The yield on the policy-sensitive 2-year note hit a 15-month high, settling at 4.147 percent. Financial strategists note that a resilient domestic economy, coupled with rising oil and commodity price risks stemming from the Persian Gulf, makes it incredibly difficult for the Federal Reserve to consider rate cuts anytime soon. The tech sector bore the brunt of the panic, with artificial intelligence chip giant Nvidia and semiconductor firm Broadcom leading the losses, the latter dropping nearly 8 percent.
Compounding the domestic economic worries was a defensive shift by investors wary of weekend geopolitical developments. Tensions flared as Iran reaffirmed its unwavering support for Hezbollah, demanding Israel’s immediate withdrawal from southern Lebanon—a demand Israel has firmly rejected. As diplomatic efforts to resolve the broader US-Iran conflict stall, international indices also reacted, with MSCI’s gauge of global stocks falling 2.27 percent, reflecting deep global anxiety over long-term market stability.