The global economy seems to be in a slight recession, overlooking a larger problem. The constant fear of the Chinese and European economy, which was exacerbated by the Volkswagen scandal, seems to be an ominous looming threat. Standard and Poor’s has warned economies about potential meltdowns if the economy isn’t well stimulated through interest rates. While most economies face general crisis, the tech industry seems to engender some welcoming news. In the face of an ailing European economy, additionally compounded by the Greek situation, the tech market stocks seem to have risen to its highest mark in two and a half months.
The Fed and the interest rate
In the light of this spike in tech stocks, the global economy still remains apprehensive about America and the Federal Reserves’ role in the following couple of months. Most investments seem to have stalled while awaiting the Federal Reserves’ final decision on interest rates next month. The Fed’s chief, Janet Yellen, said that it would be imprudent to hike interest rates until and unless the American job markets improve.
The American job markets seem to be growing and holding firm footing, this is creating a much needed relief with the ongoing problems in China and the European Union. The dollar rate seems to be rising too. It has risen by nearly 1% due to the stabilizing jobs market and the consistency of the interest rates so far.
Interestingly, an uncertain Turkish market seemed to revive back to normalcy after the landslide victory of the AK Party. The ruling party’s political stability has converted to a rising rate of the Lira.
Volkswagen seems to be continuously mired in the emission test scandal. The German automakers’ stocks have dropped by a drastic 3 percent and have additionally affected the subsidiary concerns of the world’s largest automobile manufacturer. Audi, Porsche and Skoda seem to have reported a diminishing sales figure.
Slumping Asian markets
In Asian markets, Japan seemed to be the biggest winner in the day’s market despite Japanese markets being shut on account of a public holiday. The Nikkei reported a rise of over 1 percent at closing bell today. China continues to witness a slump in its financial market, however, President Xi Jinping seems to have placated market concerns by stating that China would experience a 6.6 percent growth rate over the next five years, regardless of the current economy.
The tech markets’ rise in stock rates has bolstered a slow but steady growth in the NASDAQ index. NASDAQ reported a rise of 1.5 percent at closing bell.