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The mood of financial markets worsened through the day as fears of a global recession and worsening growth in the eurozone and in particular Germany spooked the market.
Notably, the euro currency fell to a 20-year low at around 1.0250, as the US dollar index broke to new multi-year trading highs, following its recent range break above 1.0600.
The move lower in the euro currency reflected the markets growing concern about a European economic slowdown, largely prompted by inflationary pressure from growing energy prices.
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Market participants are now fearing that it could be particularly harsh winter for the European economy if Russia cuts of its natural gas and electricity to Europe.
Even better than expected Factory Orders data from the United States economy could not help the market today. US Factory Orders came in at 1.6% instead of the 0.5% expected.
Precious metals also continued to get hammered into the day due to high as 106.64. Gold, silver, and copper have been on a multi-day losing streak.
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Gold prices fell towards the $1,760 support zone, marking a new low for the yellow metal. Silver fell within touching distance of $19.00, while copper prices tested towards $350.00.
The S&P 500 dropped by more than 1.5% this afternoon, while the Dow Jones declined by more than 550 points, or 1.8% on the market open.
With tech stocks in peril at the moment the Nasdaq also remained in the red but has clawed back most of its intraday losses after dropping by nearly 2 percent.
One notion I have why tech stocks have recovered today is that bonds have been falling over recent days, and the stock market could start to take that as bullish.
Lower yields are good for stocks and tech in particular due to its perception as a long-duration asset. Also, the turnaround in oil prices today could lead to the FED hiking less aggressively.
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Despite tech stocks staging a recovery, crypto remains under serious pressure. Crypto had a solid Monday session, with Bitcoin trading towards $20,550.
Much of the fear of the crypto now is coming from worries about contagion. Any bad news in the market and traders are selling into rallies still. Also, the breakout in the DXY is bad for crypto.
