Wall Street drops as Pelosi visits Taiwan – Reuters

Stock markets reacted negatively to US House of Representatives Speaker Nancy Pelosi’s visit to Taiwan and caused by this geopolitical tensions between the US and China. The stock index S&P 500 ended the session with a decrease in the value of shares. This is reported Reuters.

Thus, Microsoft (MSFT.O) and Visa (VN) lost 1.1% and 2.4%, respectively. All 11 S&P 500 sector indices lost ground, led by the Real Estate Index (SPLRCR), which shed 1.3%. Financial indices (SPSY) fell 1.1%. Industry leader Caterpillar (CAT.N) dropped 5.8%.

The S&P 500 was down 0.66%, the Nasdaq was down 0.16% and the Dow Jones Industrial Average was down 1.23% to 32,396.30.

Read also: Nancy Pelosi: Why am I leading a congressional delegation to Taiwan?

The fall in financial markets is so sharp because they have already weakened in recent months due to Russia’s war against Ukraine and rising inflation. The number of vacancies in the US in June fell to a record decrease in the last two years, as the demand for workers fell in retail and wholesale trade.

“The market has to come to terms with the fact that all the Fed rate hikes are behind us and I think that this question remains open, said Rob Haworth, senior investment strategist at US Bank Wealth Management in Seattle. – Problems and supply constraints are not necessarily resolved. They have not yet ended and have not disappeared.

Read also: FT: China gave Pelosi’s visit to Taiwan more importance than it deserves

It is interesting that shares of American defense companies Raytheon Technologies Corp (RTX.N), Lockheed Martin Corp (LMT.N), Northrop Grumman Corp (NOC.N) and L3Harris Technologies Inc (LHX.N) were growing. They ended the session up 0.5% to 2.3%. This is due to the fact that The United States is Taiwan’s main supplier of weapons and will provide them in the event of a Chinese attack..

Read also: Bloomberg: What can China do in response to Pelosi’s visit to Taiwan?

Recall after Pelosi’s plane landed in Taiwan, Beijing didn’t hold back its outrage. China announced a series of military operations and exercises that followed promises of “decisive and strong measures” if Pelosi continues his visit. The United States has strengthened its naval grouping in the Philippine Sea.

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