Wall Street fell more than 1,000 points on Friday March 23, knocking down Dow Jones in two days.
Investors, increasingly worried about a possible trade war between the US and China, are avoiding risk in the coming days and are trying to protect themselves from further losses..
In an unstable session S&The P 500 came close to its 200-day moving average, a key technical stage. The benchmark index approached the February low, which marked a correction, and ended up 9.9 percent below its record on January 26.
Duty war: US versus China
“There are fears that a trade war may begin: investors are switching to managing their risk. If the trend continues to grow rapidly, it will become a serious obstacle for the market, ”said Peter Kenny, senior market strategist at the Gloval Markets Advisory Group from New York.
Donald Trump’s plans to introduce annual duties on Chinese goods worth up to $ 60 billion have led the two largest economies in the world to approach a trade war. In turn, China announced plans to levy import duties of up to $ 3 billion, including fruit and wine, even if it forces the US to “move away from the edge of the abyss”.
The situation on the exchanges
Dow Jones fell 242.69 points or 1.77% to 23,533.2.
S&The P 500 lost 55.43 points, which is similar to 2.10% and stopped at 2588.26, which slightly exceeded its 200-day moving average (2585.22 points).
Nasdaq 100 fell 174.01 points, which corresponds to 2.43%, and fell to the mark of 6992.67.
During the week, the Dow Jones showed a decline of 5.67%, S&The P500 dropped 5.95%, while the Nasdaq 100 dropped 6.54%. It is worth noting that this is the largest weekly drop in indices since January 2016..
Regarding the maximum set on January 26, 2018, the Dow Jones lost 11.6% and reached its minimum close after confirming the correction in February.
Cboe Volatility Index, which the most widely used as a barometer of expected short-term volatility in S&P500 was 1.53 points at 24.87. This is the highest since February 13.
The largest percentage loss among S&P suffered a financial sector (3% drop). This happened as a result of an unstable trading session in which it was cut off by the unstable yield of treasury bonds..
Bloomberg News quotes a message from the Chinese ambassador to the US stating that the country is considering all options in response to fees, including a reduction in purchases of US securities.
The decline in Nasdaq activity is associated with a reduction in the number of shares in companies such as Facebook, Amazon.com, Microsoft and the holding Alphabet, which includes google.
The semiconductor sector showed a fall after the release of the quarterly report of Micron Technology, which raised concerns about falling prices for NAND. Philadelphia Semiconductor Index Down 3.3%.
Falling stocks outnumbered those on the New York Stock Exchange 3.96 to 1, and Nasdaq 3.72 to 1.
S&The P500 showed two new 52-week highs and 42 new lows; Nasdaq marks 23 new highs and 93 new lows.
The volume of US exchanges amounted to 8.11 billion shares, which is higher than the average of 7.3 billion over the past 20 trading days..
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