A court in Hong Kong ordered the liquidation of $300 billion in assets for China's largest real estate company, Evergrande. Evergrande share price fell 20% before the court ruling that forces the authorities to suspend trading in the shares. Evergrande's liquidation could create a domino effect of a slowdown in the Asian and US stock markets on Monday.
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However, the Asian market resisted the Evergrande sell-off and is trading in the green during the opening bell on Monday. Read here for a realistic price prediction on how the US stock market will do in 2024.
How will the US stock market react on Monday following Evergrande's liquidation of $300 billion in assets?
The Hang Seng index has risen almost 125 points, while India's Sensex index has risen nearly 1,000 points. The broader Chinese and Asian stock markets rose on Monday despite Evergrande's $300 billion liquidation. Therefore, the US stock market may not be affected by the Evergrande liquidation as Asian markets recovered quickly.
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The Dow Jones Industrial Average closed almost 61 points higher on Friday and could continue the price increase this week. The US stock market overcame several challenges in 2023, including calls for a recession from leading analysts and global banks.
JP Morgan and Standard Chartered had predicted a recession in 2023, but the US stock market pulled through. Similar sentiments are repeated in 2024, predicting a decline in the US stock market during the second quarter of this year.
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However, now that the Federal Reserve is reducing inflation from 6.5% to 3.1%, the economy remains on the right track. The Federal Reserve has been paying more attention to inflation and lowering prices for a year.
Read here to find out which US stocks star investor Warren Buffet's Berkshire Hathaway is stockpiling massively this year in 2024.
