Global stock market downturn intensifies, investors turn to bond market for risk avoidance

News on August 5, the global stock market fell sharply on Monday, with the Federal Reserve lagging in policy support for a slowing U.S. economy, prompting investors to seek refuge in the bond market. The Japanese stock market fell for the third consecutive day as traders expected further interest rate hikes domestically. In addition, South Korean and Australian markets declined while US index futures dropped more than 1.5%. Investors are worried about a possible hard landing of the U.S. economy; an increase in U.S. bonds has led to a drop in Treasury yields to over one-year lows. Various market trends indicate that investor sentiment quickly shifted expectations towards whether or not the Fed could facilitate a soft landing for the U.S economy. Data released on Friday showed that non-farm employment figures recorded their weakest levels since pandemic onset and unemployment rates rose for four consecutive months to 4.3%, higher than Fed's year-end forecast - triggering closely watched economic recession indicators . Meanwhile, Bitcoin briefly plunged more than 10% before recovering some losses as global risk aversion hit cryptocurrency markets.