Markets across the United States fell sharply on Thursday amid rising concern that the US economy may be losing momentum—with companies announcing mass layoffs and hiring freezes. The S&P 500 dropped about 1.1 % and the tech‑heavy Nasdaq Composite lost roughly 1.9 %.
A monthly survey from the outplacement firm Challenger, Gray & Christmas revealed that employers announced 153,074 job cuts in the US last month—significantly higher than the 55,597 reported in October 2024—and that so far this year over 1.09 million jobs have been slashed across the first ten months, a 44 per cent increase from 761,358 in the same period last year. Technology firms led the charge in the private‐sector layoffs.
Analysts say the decline in market confidence is also being driven by the absence of timely official government data—delays caused by the ongoing federal shutdown—which leaves the Federal Reserve and markets “groping around in the dark”. As noted by Chris Beauchamp, chief market analyst at IG Group: “The lack of US data and the ongoing government shutdown is making investors nervous.”
Meanwhile, the speculative surge in artificial‑intelligence related firms has raised concerns about elevated valuations. As Danni Hewson, head of financial analysis at AJ Bell, put it: “In the US, most of the big tech beasts have reported earnings but there is still lingering concerns about those lofty valuations and the mind‑boggling sums of cash being invested into the AI dream.”
On top of these factors, the Supreme Court of the United States’s review of the tariff policy of Donald Trump is adding to uncertainty—if the tariffs are rolled back, inflationary pressures could ease. But as Beauchamp noted: “If the supreme court rolls back some of the tariffs then inflationary worries will subside to an extent, though this is a topic that will not come to fruition for weeks.”
In Europe the mood was downbeat too: the UK’s FTSE 100 slipped 0.4 % (about 41 points) and tech stocks weighed especially heavily on the broader European index Stoxx Europe 600, which ended the day down roughly 0.7 %. Germany’s DAX fell about 1.3 %.
About the Author
