The Dow Jones ended up yielding 0.58%, to 25,400.64 points, and the Standard & Poor’s 500 decreased 0.21%, to 3,029.73 points.
For its part, the technological Nasdaq Composite slid 0.46%, to 9,368.99 points.
The stock markets continued to rise near the end of the session, but tensions between Washington and Beijing ended up speaking louder in investor sentiment.
The American president announced that tomorrow he will give a press conference to talk about China and that was enough for the market to reverse.
A source told Reuters that the U.S. is planning to cancel visas for thousands of Chinese students whom the Trump Administration suspects have links to the Chinese army.
This new focus of friction joins others of the past few days.
Yesterday, the House of Representatives sent Donald Trump the bill that provides for sanctions on China for the arrest and torture of Uighur Muslims.
In addition, on May 21, the Senate passed a bill which aims to compel Chinese companies to follow the accounting rules of the United States, under the risk of being expelled from the stock exchange. The legislative proposal now needs to be voted on in the House of Representatives – and if it also has the green light there, it goes on for approval by the President.
On the other hand, US senators announced last week that they intend to present a bill to sanction Chinese leaders due to the new national security law for Hong Kong. With this new national security law, Beijing aims to tighten control in Hong Kong, restricting opposition activity to contain new episodes of activists’ clashes for democracy.
For this reason, US Secretary of State Mike Pompeo yesterday notified Congress that the Trump Administration no longer considers Hong Kong to be an autonomous territory of mainland China.
Today the US, Australian, Canadian and UK governments issued a joint statement reiterating their “deep fears over Beijing’s decision to impose a national security law on Hong Kong”, this after the Chinese parliament passed the new legislation.
China and the United States maintained a tough trade arm for about a year and a half, with sanctions imposed on both sides – and with most still in place. Now, in recent weeks, frictions are growing on other fronts.
On the economic front, despite the fact that fewer Americans applied for unemployment benefits last week, the number is still quite high, with 2.13 million people applying for state aid.
This was the eighth week in which the number of new applications for unemployment benefits decreased in the US (always compared to the previous week), when in early April there was a peak of 6.9 million new applications. Still, since the entry into force of the containment measures in the US in mid-March, 40 million people have already applied for this subsidy.
The positive side
Highlighted on the gains side in today’s day were mainly technological and health care companies, especially pharmaceutical companies – the latter animated by the progress in the search for a vaccine against covid-19.
The technology, which traded down in the pre-opening session, ended up also shining in this session.
Before the formal opening of trading at regular hours, companies in the industry were under pressure from the announcement that President Donald Trump remains on Twitter and Facebook.
Trump may be on the verge of announcing an executive order targeted at social media companies, after Twitter applied a ‘fact check’ to two tweets from the president, which he did not like.
The White House chief accused Twitter of censorship, warning that if they continued to check his messages on that social network, he would use the power of the federal government to halt them or even end his activities.
However, law experts surveyed by CNN say that Trump’s options in this regard are somewhat limited – which has made the industry’s companies catch their breath.
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