A stock market sell-off and some disappointing economic data has raised the prospect of a recession in the run-up to November’s all-important presidential election.
In what could prove to be a disaster for Kamala Harris’s campaign against Donald Trump, investors are increasingly concerned that Biden’s disastrous premiership could conclude with an economic downturn as Democrats seek to keep control of both the White House and both Houses of Congress.
CNBC reports:
The Dow dropped 494.82 points, or 1.21%, to end at 40,347.97. At its session lows, the 30-stock index lost 744.22 points, or about 1.8%. The S&P 500 shed 1.37% to end at 5,446.68, while the Nasdaq Composite slipped 2.3% to 17,194.15. The Russell 2000 index, the small-cap benchmark that has rallied lately, dropped 3%.
Some fresh data stoked fears over a possible recession and the notion that the Federal Reserve could be too late to start cutting interest rates. Initial jobless claims rose the most since August 2023. The ISM manufacturing index, a barometer of factory activity in the U.S., came in at 46.8%, worse than expected and a signal of economic contraction. After these releases, the 10-year Treasury yield dropped below 4% for the first time since February.
These weak data releases come a day after central bank policymakers chose to keep rates at the highest levels in two decades, when Fed Chair Jerome Powell gave investors some hope by signaling a September rate cut is on the table.
While Joe Biden and Kamala Harris has repeatedly claimed that they have created millions of jobs and are overseeing a booming economy, the truth is quite the opposite.
Since seizing office in 2021, the Biden administration has overseen soaring levels of inflation that have depleted the buying power of ordinary Americans.
The economy remains a critical issue for voters, with recent polling data from Pew Research indicating that 73% of Americans view strengthening the economy as a top priority.
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