What Triggered the latest Global Market Sell-Off ???

It was not a good day to starts with on 10 Oct 2018, where US stocks suffered their worst fall since early February. The turbulence in US stock markets triggered another sell-off in Asia the following day, with the MSCI Asia ex-Japan falling to a 19-month low.

The sell-off hit broader equity markets in Asia – bourses in Taiwan, South Korea, and China registered deep losses. Of course, Malaysia could not shield itself from this slump either.

Why Global Market Sell-Off ???

Rising bond yields
The highlight here is on the yield of 10-year US Treasuries, which have surged from 2.8% at the end of August to as high as 3.2% earlier this week. The higher bond yield was said to have a knock-on effect on the so-called “real economy” because it was the benchmark of interest rate in the US. Higher financing costs may prevail due to this.

Global economy slowdown
Then, thanks to the International Monetary Fund (IMF) which painted a gloomy outlook for the world's GDP growth at 3.7%, down from its April estimate of 3.9%.
Escalating US-China trade war
Not a news anymore, but the fighting between the two of the world largest economy would only derail the world's growth. No one will win either.
Spiking crude oil prices
When crude oil prices rally to above US$70/bbl currently, it stokes up the inflation fears among central bankers to raise the interest rate to contain it. Raising interest rate is not a big deal, but hiking it too fast over a short period of time doesn't bode well to the economy.

Some of the WORST crashes happened in the month of September & October:

Sept, 1869 – Within minutes, the inflated gold prices plummeted 20% from $160 to $133, dragging down the stock market altogether with it.
Sept, 1873 – The starts of the "Panic of 1873" that triggered the first 'Great Depression' in the United States and abroad.
Oct, 1907 – A bust in the speculative run of copper affected banks in the US, leading to the stock market dropping 50%.
Oct, 1929 – Known as The Wall Street Crash in US
Oct, 1987 – Dow Jones fell 22.6%, the worst daily loss in its history, labeled as Black Monday
Oct, 1997 – Dow Jones crashed caused by the Asian or Tom Yum Goong crisis.
Oct, 2002 – The month when NASDAQ hit the bottom from the famous ‘dotcom’ bubble burst in 2000, and from Sept 11, 2001 attacks on the world trade center twin towers
Sept, 2008 – Collapsed of the big brother - Lehman Brothers, then the collapsed of world markets as a result
Oct, 2018 - ???

We still have another 2.5 weeks to go before ending this concerning October. Would it be another crash of the history? Let's wait and see...

Milan Tomic

Hi. I’m Designer of Blog Magic. I’m CEO/Founder of ThemeXpose. I’m Creative Art Director, Web Designer, UI/UX Designer, Interaction Designer, Industrial Designer, Web Developer, Business Enthusiast, StartUp Enthusiast, Speaker, Writer and Photographer. Inspired to make things looks better.