Global markets tumble as recession fears return
Stocks nose-dived, government bond prices plummeted, the pound dipped against the dollar, oil prices slumped and cryptocurrencies wobbled Friday as investors, already worried about rising interest rates and stubbornly high inflation, started quaking at the growing likelihood of a recession.
Their worries grew throughout the week as central banks around the world, from Sweden to Indonesia, once again wielded their blunt but powerful tool – interest rate increases – to combat inflation. Previous rate increases have already raised costs for consumers and businesses. Further ones could augur a period of higher unemployment and slower economic growth.
Investors don’t like that prospect. So they sold off shares Friday, pushing the S&P 500 stock index down by as much as 2.9%, before a late rally left the index 1.7% lower at the close of trading.
Earlier this week, the Federal Reserve raised interest rates by three-quarters of a percentage point for the third time since June. Fed Chair Jerome Powell warned that more pain was to come as the central bank focuses single-mindedly on fighting inflation.
The rapid climb in interest rates across the world is “increasing the chance of recession,” said Kristina Hooper, chief global market strategist at Invesco.
Moves across the Atlantic also unnerved investors. On Friday, the new British government announced a sweeping series of tax cuts, betting it had found the path to economic growth despite high inflation. But many investors feared that the tax cuts would overstimulate the country’s economy, leading to even more rate increases.
The FTSE 100, Britain’s benchmark stock index, fell more than 2%. Europe’s Stoxx 600 index fell into a bear market – defined as a fall of 20% or more from its most recent high. And the British pound dropped more than 3% against the U.S. dollar to about $1.09, its lowest level since 1985. The pound also fell roughly 2% against the euro Friday.
Colorado’s McClain died of ketamine toxicity after arrest
DENVER – The Adams County coroner’s office changed Elijah McClain’s cause of death from “undetermined” to ketamine toxicity after reviewing additional evidence during the grand jury investigation into his death, according to an updated autopsy report released Friday.
“I believe that Mr. McClain would most likely be alive but for the administration of ketamine,” forensic pathology consultant Stephen Cina wrote in the updated autopsy report.
The manner of McClain’s death – such rulings can include homicide, accidental or natural – remains undetermined.
McClain, 23, died in 2019 after three Aurora police officers violently arrested him – though he had committed no crime – and two paramedics injected him with the powerful sedative ketamine.
Former Adams County District Attorney Dave Young declined to charge the officers and paramedics in connection with McClain’s death, citing in part the autopsy’s finding that the cause of death was undetermined. But a statewide grand jury in 2021 indicted the five men on charges – including criminally negligent homicide – following intense scrutiny during the 2020 police brutality protests.
The five defendants – Peter Cichuniec, Jeremy Cooper, Nathan Woodyard, Randy Roedema and Jason Rosenblatt – are scheduled for arraignment Nov. 4.
Adams County Coroner Monica Broncucia-Jordan released the updated autopsy Friday after a lawsuit filed by Colorado Public Radio and other local news outlets. She initially denied a request for the autopsy because it included information from the grand jury that is not public record.
Fiona roars toward Canada; new storm threatens Florida
After lashing Bermuda, Hurricane Fiona is racing north toward Eastern Canada, threatening to become the most powerful storm ever to hit the region. A second system, meanwhile, is developing in the Caribbean and may strike Cuba and Florida early next week.
Packing winds of 125 miles per hour, Fiona is on pace to hit Nova Scotia Saturday as a Category 2 hurricane, expected to leave a swath of destruction, the U.S. National Hurricane Center said.
“This could be the worst storm they have ever seen,” said Don Keeney, a meteorologist at commercial-forecaster Maxar.
The system in the Caribbean, currently a tropical depression, is forecast to grow into a hurricane by early Monday, barrel over Western Cuba on Tuesday and strike Florida’s West Coast Wednesday.
The two storms are a forceful sign that the Atlantic Hurricane season is roaring to life after months of quiet. Forecasters had predicted an unusually active year. Yet for the first time in 25 years, the Atlantic didn’t churn up a single tropical storm during August. Now September has given rise to three hurricanes, with a fourth threating to form.
Fiona has already cut a swath of destruction across the Caribbean, leaving floods, landslides and power outages on the Dominican Republic and Puerto Rico. Hurricane warnings have been posted for parts of Nova Scotia, Prince Edward Island, and Newfoundland.
Fiona could cause between $1 billion to $1.5 billion in damage in Canada, based on its current forecast, said Chuck Watson, a disaster modeler with Enki Research.
The storm in the Caribbean, likely to be named Hermine, is on track to pass just west of Havana and strike Florida near Fort Myers. There is a chance the track will change, potentially shifting further west into the Gulf of Mexico. The storm’s current forecast keeps it away from offshore oil and natural gas production in the western Gulf.
The storm could cause about $12 billion in losses in western Florida and Cuba, Watson said. The damage could be particularly harsh for citrus growers, who are just about to start harvesting their crops.
“If it does hit, this is the worst time of year for that to happen,” Keeney said.
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