Global Market falls, European, Japanese stocks hit hard by economic concerns

(MENAFN) European stock markets experienced their lowest levels in nearly six months, driven by a global sell-off prompted by fears of an economic slowdown in the United States. The Stoxx 600 index fell by 3.1 percent to 482.42 points, marking its lowest point since February 13. Major European indices also suffered significant losses, with France's CAC 40 declining by 2.6 percent, Germany's DAX falling 2.5 percent, and Britain's FTSE 100 dropping 2.04 percent. The financial sector was particularly affected, with the banking sub-index down 4.2 percent, the financial services sub-index down 3.6 percent, and the technology sub-index falling by 5 percent.

In Japan, the stock market faced a severe collapse, marking its largest daily loss since the Black Monday crash of 1987. The Nikkei index plummeted 12.4 percent following concerns raised by U.S. jobs data and a surge in the yen to a seven-month high against the dollar. Japanese banking stocks led the decline, causing the Nikkei to drop 27 percent from its peak on July 11. By the end of the trading session, the Nikkei had lost 113 trillion yen (USD792.32 billion) in market capitalization. The rapid appreciation of the yen is placing significant pressure on Japanese stocks and undermining carry trades, where investors borrow in yen to invest in higher-yielding assets, particularly U.S. technology stocks.

The Nikkei's dramatic drop of 4,451.28 points was the largest one-day loss ever recorded, surpassing the previous record of 3,836.48 points lost on October 20, 1987, during the global market crash. The banking sector was particularly hard-hit, falling 17 percent, while the broader Topix index also saw a significant decline of 12.2 percent, closing at 2,227.15. The combination of global market turbulence and domestic financial instability has resulted in a severe market downturn in Japan. 

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