Global stock markets recover after turbulent Monday

The Tokyo Stock Exchange and European markets recovered on Tuesday, the day after a day of panic fueled by fears of a US recession.

Stock indices in the world’s major financial centres plunged on Monday, starting with the dizzying fall of Tokyo. NYWall Street collapsed and the Dow Jones, in its worst day since 2022, lost 2.60% to 38,703.27 points.

The main trigger for the collapse was the publication last week of the unemployment rate in the united stateswhich rose more than expected in July, to 4.3%.

But on Tuesday, the markets calmed down, in “a turn of trend“, according to Deutsche Bank analysts.

In Tokyo, the Nikkei 225 benchmark index rose 10.23% to 34,675.46 points, and the broader Topix gained 9.30% to 2,434.21 points.

The Nikkei had plunged more than 12%, or 4,451.28 points, the day before, the biggest loss of points in its history.

In Europe, the day after a red close, the main European stock markets also opened in positive territory. At 07:35 GMT, Frankfurt was up 0.77%, London 0.47%, Amsterdam 0.76%, and Paris 0.10%.

At the currency level, after soaring on Monday, the yen fell 1.09% against the dollar, to 145.78 yen per greenback at 07:30 GMT and 0.98% against the euro, to 159.46 yen per euro.

According to data published last week, the American economy added 114,000 jobs last month, a drop from the previous month and less than expected, while the unemployment rate rose to 4.3%, the highest level since October 2021.

These figures gave investors the impression that the Federal Reserve (Fed) had delayed interest rate cuts for too long and could trigger a recession, analysts said.