Japanese stocks witnessed a dramatic rebound on Tuesday, following their worst single-day decline since the 1987 Black Monday crash. The Nikkei 225 index recovered over 8% to above 34,000, while the broader Topix index gained 8% to 2,410. This recovery came after both benchmarks had crashed more than 12% the previous day. Technology and AI-related stocks, such as Tokyo Electron, Advantest, and SoftBank Group, drove the rebound, though they were still below their mid-July highs. The yen's strength, that came from the yen carry trade, had pressured Japanese equities, but the currency's rally showed signs of easing after hitting 142 yen against the USD.

EQUITY

The U.S. stock market took a nosedive on Monday, with the Nasdaq and S&P 500 both closing over 3% in negative territory. This drastic selloff came on the heels of last week's sell-off, triggered by growing recession prospects. Weak economic data, including a plummeting job market, supported the case. Big tech stocks like Apple, Nvidia, and Microsoft were hit hard after Warren Buffett's Berkshire Hathaway cut its Apple stake in half, stacking most of its wealth in cash and bonds. The market's fear gauge has also spiked to levels not seen since late 2020.

GOLD

Gold prices crashed along with the dollar on Monday, although it now sees support, rebounding off around $2,364 per ounce. The precious metal's appeal as a safe-haven asset remains stronger during the market risk-off and rate adjustment cycles. Investors are weighing the possibility of a recession, with weak economic data and disappointing corporate earnings contributing to a risk-averse sentiment in the markets. Bullion could also be affected by the return of cash flow into its industry, that can regain its production capacity.

OIL
Brent crude oil prices have been purging, reaching 8-month lows before rebounding due to various global factors. Production halts at Libya's largest oil field, Sharara, due to protests have supported prices. However, both the US and China have reported contractions in their manufacturing sectors, heightening concerns related to lowered oil consumption and recession fears.

CURRENCY

The global currency market saw enormous volatility, with the Japanese yen and Swiss franc showing strong movement. The yen initially strengthened to a seven-month high against the dollar, driven by the Bank of Japan's interest rate hike and the unwinding of carry trades. However, the yen later stabilised as market sentiment shifted, with the dollar regaining some ground against major currencies. Cryptocurrency markets were not immune to these volatile moves, with Bitcoin and Ethereum going through bigger slumps. The market is hoping for an emergency feed meeting, but it is unlikely to manifest.