UK Markets Drop Amid Global Economic Concerns, Nvidia Slump

UK shares fell on Wednesday, following declines in Asian and US markets, as global economic concerns weigh on investor sentiment. The FTSE 100 index dropped 0.76% in early trading, mirroring losses across major European indexes.

The downturn in global markets was driven by subdued US manufacturing data, with investors now focusing on upcoming US jobs figures due on Friday. This data is expected to influence the Federal Reserve’s interest rate decision next week.

US tech stocks were particularly hit, with Nvidia leading the decline, dropping nearly 10%. Despite this, Nvidia’s shares remain significantly higher than a year ago, driven by the surge in demand for AI-related technology. Other tech giants like Alphabet, Apple, and Microsoft also saw their shares fall sharply.

In Asia, markets also struggled, with Japan’s Nikkei 225 down 4.4%, South Korea’s Kospi dropping 3%, and Hong Kong’s Hang Seng declining by 1.3%. Major Asian technology firms, including TSMC and Samsung Electronics, experienced significant losses.

Market analysts attribute the global sell-off to growing concerns about economic growth, particularly in export-driven Asian economies. Investors are now keenly awaiting Friday’s US jobs report for further insights into the direction of the US economy.

Swetha Ramachandran of Artemis Investment Management noted that Nvidia’s slide reflects a “reality check” on growth expectations, following the company’s forecast of slower growth in the coming quarter. Additionally, reports of a US Department of Justice subpoena over potential antitrust issues may have further impacted Nvidia’s stock.