Global Markets Rattled as Panic Selling Triggers Circuit Breakers
Shockwaves reverberated across global financial markets today, as major Asian indices tumbled at the opening bell. Trading halts were triggered in Japan, South Korea, and Taiwan amid heavy losses, with the Nikkei 225 plunging over 8%, officially entering bear market territory. Across the globe, European markets opened sharply lower—down approximately 6%—as investor sentiment soured worldwide.
U.S. Treasury Secretary Scott Bessent pointed to a flurry of trade negotiations as a signal of the administration's leverage on the world stage. “More than 50 countries have approached us about lowering non-tariff barriers, cutting tariffs, and halting currency manipulation,” Bessent said Monday. President Trump is set to meet Israeli Prime Minister Benjamin Netanyahu at the White House today, with the controversial 17% levy on Israeli imports expected to top the agenda. Meanwhile, Japanese Prime Minister Shigeru Ishiba is reportedly planning a call with the president.
In the U.S., S&P 500 futures dropped nearly 4% ahead of the opening bell, edging the index closer to bear market territory alongside the Nasdaq. While no investor welcomes portfolio declines, seasoned market watchers note that downturns often present buying opportunities for long-term investors. The key: focus on high-quality stocks and resist the urge to time the bottom.
Bitcoin, Oil Join the Sell-Off
Risk assets weren’t spared in today’s rout. Bitcoin (CRYPTO:BTC) sank below $75,000 for the first time since November, effectively erasing all gains since President Trump’s re-election. The drop marks a steep 31% decline from its January peak.
“Expect sharper corrections once U.S. markets open,” warned Julia Zhou, COO of Caladan, noting that Bitcoin often leads broader risk asset trends.
Oil prices also slid, with crude dipping below $60—a level not seen since 2021. The slide follows OPEC+ signaling plans to ramp up production, even as global recession fears deepen.
Earnings on Deck: From Arcades to Asset Managers
Investors will be keeping a close eye on earnings this week, particularly from consumer and financial sectors.
Dave & Buster’s (NASDAQ:PLAY), a longtime Rule Breakers recommendation, is scheduled to report Q4 earnings after today’s close. The company has struggled recently, missing third-quarter estimates as inflation and recession concerns cut into discretionary spending. Analysts are forecasting earnings of 65 cents per share this quarter.
On Tuesday, RPM International (NYSE:RPM)—a Dividend Investor favorite with 51 consecutive years of dividend increases—will post Q3 results. The company recently raised its quarterly dividend by 10.9% to 51 cents per share, following a string of earnings beats.
Friday wraps up the week with first-quarter results from financial giants JPMorgan Chase (NYSE:JPM), Wells Fargo (NYSE:WFC), and Morgan Stanley (NYSE:MS). All three outperformed expectations in each quarter of fiscal 2024, but analysts expect headwinds this year as recession fears and cautious consumer spending begin to bite.
All Eyes on Inflation and the Fed
The next major data release will be Thursday’s Consumer Price Index (CPI) report for March, projected to show a year-over-year increase of 2.5%, down from 2.8%. Core CPI, which excludes food and energy, is expected to tick down to 3.0% from 3.1%. On Friday, the Producer Price Index (PPI) will provide additional insight into wholesale inflation trends.
Traders are increasingly pricing in four or more rate cuts in 2025, with the CME FedWatch tool now showing a 57% chance of a rate cut at the Federal Reserve’s May 7 meeting.
Fed Chair Jerome Powell struck a cautious tone, saying, “There’s a lot of waiting and seeing going on, including by us, and that just seems like the right thing to do at a time of elevated uncertainty.”
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