Stocks tumbled on Wall Street and across European markets Thursday as investors grew increasingly concerned that the Federal Reserve and other central banks are willing to risk a recession to bring inflation under control.

The S&P 500 fell 2.5%, with more than 90% of stocks in the benchmark index closing in the red. The Dow Jones Industrial Average fell 2.2%, and the Nasdaq composite lost 3.2%. The broad slide erased all the weekly gains for the major indexes.

European stocks fell sharply, with Germany’s DAX dropping 3.3%.

The wave of selling came as central banks in Europe raised interest rates a day after the U.S. Federal Reserve hiked its key rate again, emphasizing that interest rates will need to go higher than previously expected in order to tame inflation.

“It’s this coordinated central bank tightening — stocks tend to not do well in that environment,” said Willie Delwiche, investment strategist at All Star Charts.

In the U.S., the market’s losses were widespread, though technology stocks were the biggest weight on the S&P 500. The benchmark index fell 99.57 points to 3,895.75.

The Dow slid 764.13 points to 33,202.22, while the tech-heavy Nasdaq dropped 360.36 points to 10,810.53.

Small company stocks also fell. The Russell 2000 index slid 45.85 points, or 2.5%, to close at 1,774.61.

The Fed raised its short-term interest rate by half a percentage point on Wednesday, its seventh increase this year. Central banks in Europe followed along Thursday, with the European Central Bank, Bank of England and Swiss National Bank each raising their main lending rate by a half-point Thursday.

Although the Fed is slowing the pace of its rate increases, the central bank signaled it expects rates to be higher over the coming few years than it had previously anticipated. That disappointed investors, who hoped recent signs that inflation is easing somewhat would persuade the Fed to take some pressure off the brakes it’s applying to the U.S. economy.

The federal funds rate stands at a range of 4.25% to 4.5%, the highest level in 15 years. Fed policymakers forecast that the central bank’s rate will reach a range of 5% to 5.25% by the end of 2023.

Their forecast doesn’t call for a rate cut before 2024.

The yield on the two-year Treasury, which closely tracks expectations for Fed moves, rose to 4.24% from 4.21% late Wednesday. The yield on the 10-year Treasury, which influences mortgage rates, slipped to 3.45% from 3.48%.

The three-month Treasury yield slipped to 4.31% but remains above that of the 10-year Treasury. That’s known as an inversion and considered a strong warning that the economy could be headed for a recession.

“The [stock] market’s reaction is now factoring in a recession and rejecting the possibility of the ‘soft/softish’ landing” that Fed Chair Jerome Powell raised in a speech last month, said Quincy Krosby, chief global strategist for LPL Financial.

The prospect of more Fed rate hikes have heightened Wall Street’s worries about how company earnings could fare in a recession, Delwiche said.

“[Inflation] has peaked. It will peak. It did peak — whatever. That’s not the story,” he said. “The story now is how does the economy hold up? How do earnings hold up?”

The central bank has been fighting to lower inflation at the same time that pockets of the economy, including employment and consumer spending, remain strong. That has made it more difficult to rein in high prices on everything from food to clothing.

On Thursday, the government reported that the number of Americans applying for unemployment benefits fell last week, a sign that the labor market remains strong. Meanwhile, another report showed that retail sales fell in November. That pullback followed a sharp rise in spending in October.

Like the Fed, central bank officials in Europe said inflation is not yet corralled and that more rate hikes are coming.

“We are in for a long game,” European Central Bank President Christine Lagarde said at a news conference.
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Botswana’s government says rural communities have earned $5 million since last year from the proceeds of elephant hunting. Conservationists object to the practice, but local officials say the hunts are necessary to reduce human-wildlife conflict. The annual activity attracts hunters from overseas who pay huge sums to shoot elephants.

Acting Minister of Environment and Tourism, Sethabelo Modukanele, said communities are benefiting following the lifting of a five-year hunting ban.

“Hunting was reinstated in 2019 following a five-year moratorium after extensive stakeholder consultation. This allowed communities to generate considerable revenues amounting to 50 million pula over two years [from 2021 to 2022] for their development projects,” said Modukanele.

Most of the revenue is from international hunters who pay up to $50,000 to shoot a single elephant.

Botswana Wildlife Producers Association chief executive, Isaac Theophilus, says more could be done to ensure communities benefit from wildlife resources.

“Communities can make more from hunting. The problem right now is that communities only depend on selling their hunting quotas, subleasing some of the areas allocated to them. In order to gain more from hunting, communities have to explore other avenues of trying to raise funds, like investing the P50 million that they have accrued into income generating activities,” said Theophilus.

Botswana’s growing elephant population, at more than 130,000, has created conflict with humans, as the animals often trample crops, injure or kill people.

But animal biologist Keith Lindsay said elephant hunting could hurt the species’ breeding patterns.

“The biggest male elephants are the ones that contribute most of the population in terms of survival and mating success. Their genes are actively selected and chosen by female elephants; they prefer mating with the biggest males. By taking away those big males, you are damaging the population’s genetic structure and survival chances in the future,” he said.

Meanwhile, Minister Modukanele said the government has distributed nearly 400 wild animals to small-scale farmers to ensure locals have a stake in agro-tourism.

“Government made a deliberate decision to support start-up ventures for Batswana who showed interest and met the requisite criterion for keeping of game in plowing fields. Those who qualified were assisted with animals of various species, such as impala, gemsbok, eland and zebra. To date, 277 have applied and 251 approved and 67 provided with seed stock, totaling 377 animals,” said Modukanele.

At a recent meeting of parties to CITES, the 1963 treaty to protect endangered species, some African countries tried to present a proposal seeking to ban trophy hunting in Botswana and other southern African elephant ranges.  The attempt was unsuccessful, and elephant hunting will continue in Botswana for the foreseeable future.   
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President Joe Biden enumerated billions of dollars’ worth of U.S. investments in Africa in remarks to African leaders and the continent’s business community at a three-day summit. VOA White House correspondent Anita Powell reports from the U.S.-Africa Leaders Summit in Washington.
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The Federal Reserve raised interest rates by half a percentage point on Wednesday and projected at least an additional 75 basis points of increases in borrowing costs by the end of 2023 as well as a rise in unemployment and a near stalling of economic growth. 

The U.S. central bank’s projection of the target federal funds rate rising to 5.1% in 2023 is slightly higher than investors expected heading into this week’s two-day policy meeting and appeared biased if anything to move higher. 

Only two of 19 Fed officials saw the benchmark overnight interest rate staying below 5% next year, a signal they still feel the need to lean into their battle against inflation that has been running at 40-year highs. 

“The (Federal Open Market) Committee is highly attentive to inflation risks … Ongoing increases in the target range will be appropriate in order to attain a stance of monetary policy that is sufficiently restrictive to return inflation to 2% over time,” the Fed said in a statement nearly identical to the one it issued at its November meeting. 

The new statement, approved unanimously, was released after a meeting at which officials scaled back from the three-quarters-of-a-percentage-point rate increases that were delivered at the last four gatherings. The Fed’s policy rate, which began the year at the near-zero level, is now in a target range of 4.25% to 4.50%, the highest since late 2007. 

Fed Chair Jerome Powell is scheduled to hold a news conference at 2:30 p.m. EST (1930 GMT) to provide further details on the policy meeting, which was the last of 2022. 

The new rate outlook, a rough estimate of where officials feel they can pause their current rate-hike cycle, was issued along with economic projections showing an extended battle with inflation still to come, and with near recessionary conditions developing over the year. 

Inflation, based on the Fed’s preferred measure, is seen remaining above the central bank’s 2% target at least until the end of 2025, and will still be above 3% by the end of next year. 

The median projected unemployment rate is seen rising to 4.6% over the next year from the current 3.7%, an increase that exceeds the level historically associated with a recession. 

Gross domestic product is seen growing by just 0.5% next year, the same as estimated for 2022, before rising to 1.6% in 2024 and 1.8% in 2025, a level considered to be the economy’s long-run potential. 

 
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«Ми не схвильовані», – заявив речник на пресконференції в Берліні
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Позика «покриватиме основні державні послуги, в тому числі роботу лікарень, шкіл та забезпечення житлом»
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India’s economy is posting the fastest growth among major economies putting it on track to become the world’s third largest before the end of the decade, according to financial forecasts.

As companies record strong growth and hand out pay hikes, there is a wave of optimism among professionals.

“There are good projections for the Indian economy. Plus, even in our friends’ circle, a lot of people are changing jobs, moving to better pastures. For us also, my wife, has switched recently to a new job,” said Jaideep Manchanda, a marketing professional in New Delhi who recently bought a new car.

Consumers like Manchanda and his wife, Tanya Tandon, are driving domestic demand as India emerges strongly from the COVID-19 pandemic — the automobile industry for example recorded its highest-ever sales in November. New investment is flowing into the country, helping it withstand the trend of slowing growth in most countries.

India is expected to grow by nearly 7% this year despite the economic turbulence created by Russia’s war in Ukraine. That momentum is likely to continue, helping it overtake Japan and Germany to become the world’s third-largest economy, according to a recent forecast by New York-based investment firm Morgan Stanley and S&P Global.

The International Monetary Fund projects India to reach that position by 2028. The United States and China are the world’s biggest economies.

The World Bank’s latest report on the Indian economy released in December also said that India is relatively well positioned to weather global headwinds compared to most other emerging markets.

“India’s economy has been remarkably resilient to the deteriorating external environment,” Auguste Tano Kouame, World Bank’s country director, said releasing the report “Navigating the Storm” earlier this month.

India’s economy is relatively insulated partly because it has a large domestic market and is relatively less exposed to international trade, according to the World Bank.

Growth is expected to dip in the coming year as, like many other countries, India grapples with inflation following a surge in global food and fuel prices. A potential global recession also poses a risk to its economic momentum.

However, that is not dampening optimism. “Even if the economy grows consistently at around five and a half or 6% will be remarkable,” according to Abhijit Mukhopadhyay, an economist at the Observer Research Foundation in New Delhi. “A lot of changes are happening across the world, and we hope that some of them will be beneficial for the Indian economy.”

New opportunities are opening for India as trade and geopolitical tensions between China and the United States deepen, analysists say.

For decades, global investors flocked to China to set up factories while India’s manufacturing sector lagged, holding back the economy. Efforts by Prime Minister Narendra Modi to promote a “Make in India” campaign since he took office eight years ago had met with a tepid response, but that could be changing.

On a visit to New Delhi last month United States Treasury Secretary Janet Yellen spoke of building closer economic ties with India.

“The United States is pursuing an approach called friend-shoring to diversify away from countries that present geopolitical and security risks to our supply chain. To do so we are proactively deepening economic integration with trusted trading partners like India,” Yellen said addressing technology leaders at a Microsoft facility.

Analysts say that many companies are looking at India as they consider adding production capacity in a second nation besides China.

The U.S.-based tech company Apple is expected to move some iPhone manufacturing to India and scale it up over the next three years. Taiwanese electronic company Foxconn and local conglomerate Vedanta have announced a $19.5 billion investment to make semiconductors in the western Indian state of Gujarat.

“Now, after China, India is probably being seen as the next place where growth will come. This is the expectation, and the initial signs are already there,” points out economist Mukhopadhyay. “That is why a lot of global investment, direct investment and a lot of global financial capital are now betting on India.”

Modi’s government is making efforts to lure companies by offering incentives for producing in India and investing billions of dollars in improving the country’s creaky infrastructure that has long deterred investors.

The mood is upbeat among Indian professionals, who often looked overseas for career opportunities. Now many feel they are better off at home, especially after the tens of thousands of layoffs by leading technology companies in the United States that have impacted many Indians.

“India has great potential across the sectors, across geographies, and across small and bigger cities,” said Tanya Tandon, a marketing professional.

Maintaining high growth will be vital for India, a country of 1.4 billion people, which still needs to lift millions out of poverty and also faces a massive challenge in creating jobs for its huge, young population.
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