What happened on the US stock market overnight and how could it impact ASX shares?

It wasn't a great start to the week on Wall Street…

a business person checks his mobile phone outside a Wall Street office with an American flag and other business people in the background.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The US stock market returned from the weekend and was a sea of red on Monday night. Investors were selling travel, banking, and energy shares down, leading to the Dow Jones having its worst day since October of last year.

The Dow Jones sank over 700 points or 2.1%, the S&P 500 dropped 1.6%, and the tech-focused Nasdaq index fell 1.1%.

Why did the US stock market tumble?

Investors were hitting the sell button on the US stock market amid concerns over rising COVID-19 cases and the impact this could have on the global economic recovery. This follows surging delta variant infections across the United States, UK, and countries around the world.

Among the worst performers on Wall Street were travel shares, with airlines, cruise lines, and travel bookers falling heavily.

This doesn't bode well for the likes of Flight Centre Travel Group Ltd (ASX: FLT), Qantas Airways Limited (ASX: QAN), and Webjet Limited (ASX: WEB) on Tuesday.

US banks fall

Also falling heavily on the US stock market overnight were US banks. Bank of America, Goldman Sachs, and JP Morgan all fell around 3%.

This could mean an equally red day for Commonwealth Bank of Australia (ASX: CBA) and the rest of the big four banks.

Though, the Australia and New Zealand Banking GrpLtd (ASX: ANZ) share price could behave differently depending on how well its announcement of a $1.5 billion share buy-back is received by the market.

Energy shares sink

Another group of shares that performed particularly poorly on the US stock market on Monday were energy producers. This followed a sharp decline by both the WTI crude oil price and Brent crude oil price after OPEC revealed plans to remove its production limits.

The oil cartel is intending to lift its production by 400 million barrels per day each month until September 2022. At that point, all its production cuts will have been reversed.

Oil prices fell as much as 8% overnight, which is likely to put pressure on energy shares such as Beach Energy Ltd (ASX: BPT), Santos Ltd (ASX: STO), and Woodside Petroleum Limited (ASX: WPL).

The Oil Search Ltd (ASX: OSH) share price could be an outlier, though. This morning it revealed that it recently received and rejected a takeover approach. No details were provided on the price offered or the company making the proposal.

Should you invest $1,000 in Australia And New Zealand Banking Group right now?

Before you buy Australia And New Zealand Banking Group shares, consider this:

Motley Fool investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now... and Australia And New Zealand Banking Group wasn't one of them.

The online investing service he’s run for over a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

And right now, Scott thinks there are 5 stocks that may be better buys...

See The 5 Stocks *Returns as of 30 April 2025

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Webjet Ltd. The Motley Fool Australia has recommended Flight Centre Travel Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Share Market News

A man and woman sit at a desk staring intently at a laptop screen with papers next to them.
Opinions

Where I'd invest $5,000 in ASX 300 shares right now

These stocks look like excellent investments today.

Read more »

A man holding a cup of coffee puts his thumb up and smiles while at laptop.
Broker Notes

Goldman Sachs says these ASX 200 stocks are strong buys

The broker is feeling very bullish about these stocks. But why?

Read more »

Business woman watching stocks and trends while thinking
Share Market News

5 things to watch on the ASX 200 on Wednesday

Here's what to expect on the local market today.

Read more »

A woman's hand draws a stylised 'Top Ten' on a projected surface.
Share Gainers

Here are the top 10 ASX 200 shares today

It was another tough day for investors this Tuesday.

Read more »

A man sits in despair at his computer with his hands either side of his head, staring into the screen with a pained and anguished look on his face, in a home office setting.
Share Fallers

Why HMC Capital, Platinum, Sigma, and Skycity shares are dropping today

These shares are having a tough session on Tuesday. But why?

Read more »

A close-up photo of a ballot box with an Australian flag in front of it and a gentleman's hands placing his vote in the 2022 election inside the box
Share Market News

How these ASX 200 stocks are primed to gain from Labor's resounding Federal election win

With the Federal election in the rear-view, which ASX 200 stocks should I buy now?

Read more »

A man clenches his fists in excitement as gold coins fall from the sky.
Share Gainers

Why Dimerix, Evolution Mining, Inghams, and NextDC shares are charging higher today

These shares are rising when many are falling today. But why?

Read more »

Smiling young woman eating chocolate outdoors.
Share Market News

The See's Candies playbook for ASX investors

Two ASX businesses that remind me of Buffett’s sweetest investment.

Read more »