Stock market plunges as U.S. recession fears jolt global markets

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The selloff was brutal, with the so-called Magnificent Seven group of stocks – the main driver for the indexes hitting record highs earlier this year – set to lose a combined $1 trillion in market value.

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Apple fell 4.6% after Berkshire Hathaway halved its stake in the iPhone maker, suggesting that billionaire investor Warren Buffett is growing wary about the broader U.S. economy or stock market valuations that have gotten too high.

Nvidia slid 5.6% after reports of a delay in the launch of its upcoming artificial-intelligence chips due to design flaws.

Microsoft and Alphabet fell about 3% each.

A weak jobs report and shrinking manufacturing activity in the world’s largest economy, coupled with dismal forecasts from the big U.S. technology firms, pushed the Nasdaq 100 and the Nasdaq Composite into a correction last week.

The disappointing jobs data also triggered what is known as the “Sahm Rule”, seen by many as a historically accurate recession indicator. U.S. Treasury yields tumbled to their lowest in a year and a closely watched gap between two- and 10-year Treasury notes turned positive for the first time since July 2022, usually indicating U.S. economy is heading into a downturn.