US Stocks Slide Amid Economic Slowdown Fears

NEW YORK, Feb 22, 2025 (BSS/AFP) – Wall Street stocks tumbled Friday, closing the week on a pessimistic note as concerns over slowing US economic growth intensified. While Asian markets saw gains and European stocks remained mixed, major US indices spent the entire session in the red, ending about two percent lower.

The selloff followed disappointing economic data and ongoing uncertainty surrounding President Donald Trump’s tariffs and government job cuts, which analysts fear could increase unemployment.

Weak Economic Data Sparks Selloff

“You are starting to see some disappointment in the economic data,” said Tom Cahill of Ventura Wealth Management, linking the sharp decline in the 10-year US Treasury yield to growing economic concerns.

On Friday:

• A S&P Global report showed US services industry activity had dropped to a 25-month low.
• The University of Michigan’s consumer sentiment index plunged nearly 10 percent from January.

Although considered “secondary” indicators, these reports align with other key metrics on employment and retail sales, signaling further economic weakness, said LBBW’s Karl Haeling.

“Investors have been bullish since the election,” Haeling noted, “but uncertainty surrounding Trump’s policies could be shifting market sentiment.”

Asian Tech Stocks Surge, European Markets Mixed

Asian markets performed well, driven by gains in the tech sector.

• Shanghai stocks rose, and Hong Kong’s Hang Seng Index jumped 4%, hitting a three-year high.
• Alibaba soared over 14%, building on its strong earnings report.
• Tencent climbed 6%, while JD.com and XD Inc gained over 5%.

China’s AI sector received an additional boost after DeepSeek, a tech startup, introduced a new chatbot, shaking up the global AI landscape.

In Europe, markets showed mixed results:

• Paris’ CAC 40 gained 0.4%.
• Frankfurt’s DAX dipped slightly ahead of Germany’s Sunday elections, with analysts anticipating a more expansionary fiscal policy from Berlin to counter its recent economic contractions.

“The election comes at a difficult time for Germany, following two consecutive years of economic decline,” said Jim Reid of Deutsche Bank.

Japan’s Policy Shift and Oil Market Volatility

In Tokyo, the yen weakened after Finance Minister Katsunobu Kato warned that rising government bond yields—at their highest level since 1999—could slow economic growth.

The Bank of Japan is now expected to delay aggressive rate hikes, despite core inflation hitting a 19-month high.

Meanwhile, oil prices dropped about 3%, as traders speculated that the US might ease sanctions on Russian oil exports, increasing global supply.

“It’s only a matter of time before Trump lifts sanctions on Russia,” said Arne Lohmann Rasmussen, chief analyst at Global Risk Management. While the EU is unlikely to follow suit, increased Russian oil exports could flood Chinese and Indian refineries.

Market Closing Figures (as of 2150 GMT)

• New York – Dow Jones: ⬇ 1.7% at 43,428.02
• New York – S&P 500: ⬇ 1.7% at 6,013.13
• New York – Nasdaq Composite: ⬇ 2.2% at 19,524.01
• London – FTSE 100: Flat at 8,659.37
• Paris – CAC 40: ⬆ 0.4% at 8,154.51
• Frankfurt – DAX: ⬇ 0.1% at 22,287.56
• Tokyo – Nikkei 225: ⬆ 0.3% at 38,776.94
• Hong Kong – Hang Seng: ⬆ 4.0% at 23,477.92
• Shanghai – Composite: ⬆ 0.9% at 3,379.11

Currency & Commodity Markets

• Euro/Dollar: ⬇ $1.0462 from $1.0501
• Pound/Dollar: ⬇ $1.2628 from $1.2670
• Dollar/Yen: ⬇ 149.32 from 149.64
• Euro/Pound: ⬇ 82.81 pence from 82.89 pence
• West Texas Intermediate Crude: ⬇ 3.0% at $70.40 per barrel
• Brent North Sea Crude: ⬇ 2.7% at $74.43 per barrel

Wall Street’s weak finish underscores growing concerns about economic slowdown, while global markets remain divided between tech-driven optimism in Asia and policy uncertainties in Europe and the US.