Stock Market Today: Dow closes down 1,000 points as global equity rout continues (2024)

Key reads

Ten- and 30-year Treasury yields finished lower on Monday amid investors' ongoing flight to safety into the long end of the U.S. government-debt market.

The 10-year yield fell 1.3 basis points to 3.782%, its lowest closing level since July 19, 2023. The 30-year yield dropped 4 basis points to 4.071%, the lowest closing level since Jan. 3.

The S&P 500 was on track Monday for its third straight fall of 1% or more. It marked the first such streak of three or more 1% declines for the large-cap benchmark since a four-day run that ended on June 13, 2022, according to Dow Jones Market Data.

There have been eight such streaks of three or more 1%-plus declines over the last decade. On average, the S&P 500 was down 1% a week later but tended to be higher a month, three months later. A glaring exception occurred amid the onset of the COVID-19 pandemic in 2020 (see table at top of post).

Shares of Reddit Inc. were down 1.1% on Monday afternoon ahead of the social-media platform’s second-ever quarterly earnings report as a public company on Tuesday.

The stock had rallied earlier on Monday and was up 2.3% in late-morning trading, shrugging off the broader market weakness that has sent U.S. stocks tumbling.

U.S. stocks were sharply lower, drifting back toward the lower half of the day's range, in the final hour of trading on Monday.

With Microsoft's stock shedding 3.3% on the day, and 7.4% amid a five-day losing streak, it is now the most oversold its been by one key technical metric than it has been in nine years.

The widely followed Relative Strength Index, which is a momentum indicator that measures the magnitude of recent losses against the magnitude of recent gains, is viewed by many as depicting an oversold condition when it drops below 30.

The RSI of Microsoft's stock was last at 24.68 according to FactSet, on track for the first close below 30 since Sept. 30, 2022, and at the lowest level seen since it was at 21.82 on Aug. 25, 2015.

Keep in mind that "oversold doesn't mean over, as many see the fact that a stock can become oversold as a sign of underlying weakness.

The last time Microsoft's stock's RSI closed below 30, the stock fell another 8% in five weeks before bottoming. The last time it was at current levels, marked the bottom of a short-term pullback.

Shares of CrowdStrike Holdings Inc. were up more than 1% in Monday afternoon trading, bucking the market’s downward action.

Wedbush Securities analyst Taz Koujalgi said that investors may get some relief from the contents of a letter sent by CrowdStrike’s legal team to Delta Air Lines Inc., which has hired lawyers to seek damages after a bad CrowdStrike software update led to flight cancelations.

The letter, which was reviewed by MarketWatch, said that if Delta moves forward with legal action, it “will have to explain to the public, its shareholders and ultimately a jury” that, among other things, “any liability by CrowdStrike is contractually capped at an amount in the single-digit millions.”

Delta didn’t immediately respond to a MarketWatch request for comment about the letter.

“While Delta hasn’t yet commented on the letter, and this is a fluid situation, the ‘single-digit’ million[s] liability cap claimed by [CrowdStrike] does help frame the potential risk for [CrowdStrike] as not being as bad as feared,” Koujalgi said in his note to clients.

The risk of a hard landing for the U.S. economy has been rising, but it is not the base case, according to Stephen Brown, deputy chief North America economist at Capital Economics.

The risk of a hard landing stands at around 27%, while a soft landing is still the most likely outcome, with the chances around 38%, Brown wrote in a note on Monday.

A soft landing refers to a scenario where inflation cools but the economy avoids a recession. In contrast, in a hard-landing scenario, the economy would go into a recession following the series of interest-rate hikes by the Federal Reserve, which were aimed at controlling inflation.

“The key risk to our view is that the disorderly market reaction itself, if sustained, will feed through to a higher chance of recession,” Brown wrote in the note. “That could be because financial firms get into serious trouble due to the sharp market moves, or because firms respond to the tightening of financial conditions by cutting back on investment and headcount.”

Shares of Kellanova are skyrocketing Monday, despite broad market weakness that has sent U.S. stocks tumbling amid newfound recession fears.

The Pringles maker's stock was up 14.9% at 2 p.m. Eastern time, lifted by a report that Mars is considering an acquisition of the company.

Analysts say that a potential deal could make sense.

Major stock market indexes fell sharply on Monday, leaving some traders wondering if a circuit breaker could be triggered.

Circuit breakers are built into the market structure and temporarily halt trading across exchanges when a specific security or market index moves too quickly.

The S&P 500 would trigger a marketwide circuit breaker if it dropped 7%, 13% or 20% in a day. A 7% or 15% move would lead to a 15 minute trading halt, while a 20% move would halt trading for the rest of the day.

The S&P 500 opened 4.2% lower and bounced back a little in the hours that followed. The index would have to fall to 4,972.30 today to trigger a circuit breaker.