Stock Markets Fall Amid Concern over Increasing Prices

Fears that increasing costs may cause the global economy to stagnate have caused stock markets in Asia and the United States to decline. After disappointing earnings announcements from some of the country's largest retailers, US stocks dropped the most in a single day since 2020. Target said profits had almost halved year over year due to unexpectedly increased fuel and freight costs. That followed a similarly gloomy update from Walmart earlier in the day.

In Asia afternoon trade, Japan's Nikkei index was down 1.8 percent, while Hong Kong's Hang Seng was down 2.3 percent. The Dow Jones Industrial Average fell 3.5 percent and the S&P 500 index, which monitors shares of a wide range of America's largest corporations, fell more than 4%. The Nasdaq, which is dominated by technology, dropped 4.7 percent. The losses came on top of weeks of losses on US financial markets.

Thomas Hayes, chairman of Great Hill Capital in New York, said, "What people are worried about after seeing Target is, will more earnings [estimates] have to be taken down? Consumer sentiment is at multi-year lows and tied at the hip with inflation. So people are looking for signs of inflation moderating, and Target did not give them any today."