The so-called “stock market bloodbath” has continued on Friday with major indices falling down to the lows of the last October. What's going on?
American equities are braced for lower start
On Wednesday, American stock equities were braced for a lower start, with market participants weighing the influence of the Turkish currency downtime and the worsening tariff clashes between America and its key trading partners.
While the Turkish lira keeps pulling back from its record minimums versus the evergreen buck, Turkey dared to double duties on some American products including vehicles, alcohol, and tobacco in response to recent American measures.
Additionally, the Chinese government has filed a complaint to the World Trade Organization for the purpose of determining the legality of American duties as well as subsidy policies.
Evidently, China's complaint brings the trade clash to the next level that keeps affecting financial markets.
The equities of trade-sensitive companies turned out to be the first to be affected, with 29 of the 30 businesses on the Dow Jones Industrial Average in the red in premarket trade. As a matter of fact, Caterpillar went down by 0.8%, while Boeing inched down by 0.7%.
Besides this, E-commerce giant Alibaba slipped by 3.2%, JD.com decreased by 5.2%, while Baidu went down by 2.5%.
Contributing to the dismal sentiment was a dive in crude prices because of a downbeat global economic outlook as well as a report of soaring American crude inventories, even as American sanctions on Tehran threatened to tame Iranian crude oil supplies.
The equities of crude producers Exxon as well as Chevron which both appear to be members of the Dow Jones Industrial Average, headed south.
ET, Dow e-minis decreased by 0.61%. As for S&P 500 e-minis, these shares lost 0.57%, while Nasdaq 100 e-minis slipped by 0.8%.
In addition to this, Intel inched down by 0.5% having revealed three more flaws in some of its chips.
Moreover, in July, American retail sales rallied more than anticipated because households spurred purchases of cars and clothing, thus hinting that the US economy was still firm in the third quarter.
Besides coronavirus, other news has been driving the stocks of Apple, Wallmart and General Motors to the lower levels.
Will coronavirus continue keeping the markets in fear? What releases should we wait for? Find out in the news!
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