January 28, 2023

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Wall Street falls amid escalating US-China tensions, Caterpillar stocks weighed

Wall Street falls amid escalating US-China tensions, Caterpillar stocks weighed
  • Parliament Speaker Nancy Pelosi is expected to arrive in Taipei later today
  • Caterpillar falls after missing sales estimates
  • Uber gains after reporting positive cash flow
  • Indices down: Dow 0.92%, Standard & Poor’s 0.61%, Nasdaq 0.45%

Aug 2 (Reuters) – Wall Street’s main indexes fell on Tuesday on fears of escalating tensions between the United States and China ahead of U.S. House Speaker Nancy Pelosi’s arrival in Taiwan, with losses in industrial company Caterpillar pulling back.

Shares of chip makers with significant exposure to China fell, while those of Caterpillar Inc. fell (CAT.N) It fell 3.6% as slowing construction activity in the world’s second-largest economy and halting operations in Russia added to supply chain problems. Read more

“Chip stocks are really exposed to Asia. Some of them have 70% of their sales, especially chip equipment companies, in that region, so it’s a big deal for them,” said Jack Degan, chief investment officer at Harbor Advisory.

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The recent geopolitical uncertainty comes at a time when financial markets are struggling to deal with the fallout from the Ukraine war, Europe’s energy crisis, rising inflation and tightening financial conditions.

“Any kind of geopolitical anxiety could push the traders who won a little last week to take a little (profit) off the table.”

CBOE Volatility Index (.VIX)also known as the Wall Street Fear Barometer, rose to 24.31 points, its highest level in almost a week and the Philadelphia Semiconductor Index. (.sox) It decreased by 1%.

At 10:16 a.m. ET, the Dow Jones Industrial Average (.DJI) The Standard & Poor’s Index fell 301.47 points, or 0.92%, to 3,2496.93 points (.SPX) The Nasdaq Composite Index fell 25.27 points, or 0.61%, to 4,093.36 points (nineteenth) It was down 56.02 points, or 0.45%, to 12,312.95 points.

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Among the individual stocks, DuPont de Nemours (DD.N) It fell 1.4 percent after the industrial materials maker cut its full-year forecast, while shares of credit rating company Standard & Poor’s Global Inc. (SPGI.N) It fell 2.6% on the back of a pessimistic 2022 earnings outlook. Read more

Uber Technologies Inc (UBER.N) It jumped 14.1% after the passenger carrier reported positive quarterly cash flow for the first time ever and forecast upbeat operating profit for the third quarter. Read more

Pinterest company (PINS.N) It rose 13.3% as activist investor Elliott Investment Management became the largest shareholder in the digital billboard company. Read more

Meanwhile, data showed that job opportunities in the United States fell more-than-expected in June, indicating that the demand for labor is beginning to decline, which could ease pressure on the Federal Reserve to raise interest rates aggressively. Read more

The US central bank raised interest rates by 2.25 percentage points this year and pledged to be data-driven in its approach to future increases.

Declining issues outnumbered advanced stocks by 1.90 to 1 on the New York Stock Exchange and by 1.11 to 1 on the Nasdaq.

The S&P recorded a new 52-week high and 30 new lows, while the Nasdaq recorded 21 new highs and 41 new lows.

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Additional reporting by Anirudha Ghosh and Devik Jain in Bengaluru; Editing by Anil de Silva and Aaron Coeur

Our criteria: Thomson Reuters Trust Principles.