The three main U.S. stock benchmarks are in store for their sharpest May losses in seven years as Sino-American trade tensions buffet equity values on Thursday.
The indexes are poised for an ugly monthly skid, with the Dow Jones Industrial Average DJIA, -1.70% the Nasdaq Composite Index COMP, -2.08% and the S&P 500 index SPX, -1.70% set for a decline of at least 4% so far in May.
If the losses hold over the next several trading sessions, it would represent the first May decline for any of the benchmarks since 2012, according to Dow Jones Market Data.
The stumble for stocks across the globe comes as investors are placing bets that a U.S.-China trade pact between the world’s largest economies may take far longer than originally anticipated — a view that is causing a more deliberate reassessment of prospects for corporate earnings and global economic growth.
Bloomberg reported on Thursday that strategists at Goldman Sachs, Nomura and JPMorgan Chase & Co. are among those who have shifted a Sino-American trade war to baseline expectation from just a possibility.
On top of that, fears that Britain might tumble from out of the European Union without a new trade pact in hand, also have grown, bringing with it the possibility of unsettling market participants, who have mostly prepared for an orderly Brexit.
Back in May of 2012, stocks booked their worst monthly loss in two years amid escalating concerns surrounding the eurozone debt crisis, with countries like Spain and Greece at the epicenter of raising fears of a debt contagion that could wreck Europe’s financial markets, only four years after the financial crisis buckled global economies.
Providing critical information for the U.S. trading day. Subscribe to MarketWatch’s free Need to Know newsletter. Sign up here.