Dow panics, then eases as tensions in China ease

Dow panics, then eases as tensions in China ease

The U.S. actions breathed a deep sigh of relief on Friday after President Trump’s harsh conversation with China did not include the announcement of new tariffs.

The Dow Jones industrial average fell to 368.97 points, or 1.4 percent, to 25,031.67 before 2 p.m. from Trump. Press conference. That index closed just 17.53 points, at 25383.11, a drop of 0.07.

The S&P 500 rose 14.58 points to 3044.31, an increase of 0.48 percent, while the Nasdaq was the largest engine of the day, jumping 120.88 points, or 1.29 percent, to close at 9489.87.

Trump’s announcement was expected to add heat to the simmering battle between the world’s two largest economies and throw some cold water in the recent stock market recovery. Instead, Trump announced that the United States will no longer fund the World Health Organization and will remove Hong Kong’s special relationship status after Beijing’s intensified foray into that city.

Both measures came to fruition as Trump has been threatening the WHO for months and Secretary of State Mike Pompeo determined earlier this week that Hong Kong was no longer autonomous enough from China.

“The world needs answers from China about the virus. We must have transparency. Why did China shut down infected people in Wuhan to all other parts of China? Trump said from the White House rose garden.

“There is a fear that it will lead to a growing escalation of tensions between the United States and China,” said Quincy Krosby, chief market strategist at Prudential Financial. “The concern is that this could lead to an abrupt closure of the phase one trade agreement.”

READ  Marriott suggests Trump requested cease to Cuba hotel business

Those fears were not realized on Friday.

“That was in part a relief rally,” said Lindsey Bell, chief investment strategist at Ally Invest. “The market was expecting something much worse related to the trade deal, but in the end there wasn’t much to chew on.” Just a great dip for people to buy. “

Wall Street has starred in a comeback from its coronavirus-fueled crash in the past two months as states began easing blockades aimed at controlling the pandemic. The S&P closed just 10.7 percent below its all-time high reached in February on Thursday.

Now that markets have ruled out the possibility that a trade war will reignite with China as the country reopens the pandemic, analysts expect more green days ahead.

“Investor optimism returned after a week in which some of the economic data has become less dire,” Bell said.

With posts

You May Also Like

Cory Weinberg

About the Author: Cory Weinberg

Cory Weinberg covers the intersection of tech and cities. That means digging into how startups and big tech companies are trying to reshape real estate, transportation, urban planning, and travel. Previously, he reported on Bay Area housing and commercial real estate for the San Francisco Business Times. He received a "best young journalist" award from the National Association of Real Estate Editors.

Leave a Reply

Your email address will not be published. Required fields are marked *