Wall Street’s main indices fell on Thursday, driven by fears of new trade tensions with China. The Dow led the losses with a 1.3 percent drop after three consecutive days of record highs. Tech shares contributed to the decline, with market watchers concerned about the “overbought” state of the sector. The VIX volatility index rose by 10 percent, possibly due to pressure on US President Joe Biden to exit the 2024 campaign.
In Europe, major stock markets had a mixed day, with London benefiting from a surge in oil prices. The dollar strengthened after expectations that the US Federal Reserve would cut interest rates at least once this year. The European Central Bank (ECB) kept its key interest rates steady, waiting for stable consumer price rises before considering further cuts.
Tech firms were further affected by reports that Biden could target companies supplying China with semiconductor technology. Biden is reportedly considering imposing strict curbs on companies like Tokyo Electron and ASML if they continue allowing Beijing access to their chip tech. Trump’s comments about Taiwan also weighed on sentiment, suggesting the US should be compensated for helping the island defend itself against China.
Overall, concerns over trade tensions with China and potential political developments in the US contributed to market fluctuations. Investors will be closely watching for any further developments that could impact global markets in the coming days.
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