NEW YORK (awp international) – Hopes for progress in the Ukraine conflict did not support the US stock market for long at the start of the week. Unlike the stock exchanges in Europe, the Dow Jones Industrial turned negative after initially clear price gains. Two hours before the end, the leading index lost 0.15 percent to 32,894.93 points. Due to a time change that has already taken place in the USA, trading in New York is one hour earlier than usual this week in European time.
Other US indices had slipped even more clearly into the red: the market-wide S&P 500 recently fell by 0.68 percent to 4175.59 points. The technology-heavy Nasdaq-100 was more heavily burdened by sharp price losses in the US notes of Chinese tech companies, it recently lost 1.58 percent to 13,91.768 points.
In Western Europe there had been significant gains on Monday. There, however, the fear of the economic consequences of the war had recently made itself felt much more strongly than on the US stock exchanges. At current levels, the Dow Jones Industrial is just 0.7 percent below its close on Feb. 23, the day before Russia invaded Ukraine.
The fourth ceasefire talks between Russia and Ukraine were held on Monday – this time via video link. However, these have again not brought any tangible results. On the 19th day of the war, the negotiators adjourned to this Tuesday. The interruption until Tuesday is a technical break for talks in working groups and a “clarification of individual definitions,” explained Ukrainian presidential adviser Mykhailo Podoliak.
The oil market also eased somewhat on Monday, with prices falling from their high levels on Monday. This drove investors out of the most popular US oil stocks such as Chevron and ExxonMobil, which lost 3.1 and 3.7 percent respectively at the beginning of the week.
On the Nasdaq stock exchange, the shares of Chinese companies with a US listing fell in price. The papers from Trip.com, Pinduoduo, Baidu, JD.com and Netease lost between 8.9 and 19.6 percent in value. The papers of the online giant Alibaba listed in the USA fell by 10.5 percent. The market said that these values were joined by new regulatory concerns about China’s position in the Ukraine war and about lockdown measures caused by the pandemic, which had been noticeable for some time.
As a result, the major US bank JPMorgan downgraded such values on Monday, and for many even turned their vote from a previously positive assessment to a negative “underweight”. Geopolitical risks and growing regulatory concerns are the reasons why he now sees the Chinese internet industry as unattractive for the next six to 12 months, argued analyst Alex Ya. The sector-wide sell-off could continue as he sees no supportive factors in the short-term.
In connection with new developments in China, the Apple share was also sold, it fell by 2.5 percent due to concerns about possible production bottlenecks. After a corona lockdown was imposed in Shenzhen, southern China, Apple partner Foxconn stopped production in the metropolis at its manufacturing facility, which also manufactures iPhones.
Some banks, on the other hand, have held steady ahead of the Fed’s interest rate decision on Wednesday, with what is then expected to be the first rate hike since 2018. JPMorgan remained among Dow gainers at 0.8 percent, outperforming the bank’s shares in the broader market of America up 2 percent. In general, rising capital market interest rates are a good sign for the day-to-day business of banks.
A bright spot on the Nasdaq was Moderna stock, which jumped 11 percent, accompanied by Biontech, up 12 percent, and Biontech partner Pfizer, whose shares rose 3.5 percent. The market said that mRNA vaccine values were becoming more imaginative due to the increasing number of corona cases. The recent lockdown measures in China also help, said Börsianer./tih/nas
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