Wall Street opens lower, geopolitical tensions weigh

The New York Stock Exchange fell Tuesday at the opening, the geopolitical tensions, in particular with China, weighing on the market.

Around 2:15 p.m. GMT, the Dow Jones lost 0.99%, the Nasdaq 0.51% and the S&P 500 0.68%.

Wall Street started August on a cautious note after a strong July, the best of 2020.

On Monday, the Dow Jones had lost 0.14% to 32,798.40 points, the Nasdaq 0.18% to 12,368.98 points and the S&P 500 0.28% to 4,118.63 points.

“Increased geopolitical concerns, particularly in relation to Nancy Pelosi’s visit to Taiwan, are upsetting the markets a bit, especially in Asia,” Peter Cardillo of Spartan Capital told AFP.

“The exchanges thus began in August on a cautious note, not only because of these tensions, but also because of concerns about global growth,” added the analyst.

The hypothesis of an imminent visit by the speaker of the American House of Representatives Nancy Pelosi to Taiwan, which Beijing considers to be one of the provinces, caused stock markets to fall in Asia, investors worrying about the risks of escalation with China .

Among business results, Uber was celebrated by investors (+ 12.92% to 27.78 dollars) because even if the driverless car rental company suffered a heavy loss, its quarterly turnover increased. soared, both in its transport activity but also in meal delivery.

Its turnover from April to June rose to 8.07 billion dollars against 7.36 billion expected.

The performance of the Caterpillar construction machinery group, on the other hand, weighed on the Dow Jones while the group’s sales fell to 14.2 billion dollars instead of the 14.35 billion forecast by analysts.

Caterpillar, whose title fell by almost 5%, is considered a barometer of the health of the world economy since its machines, materials, equipment and services are used in many sectors of activity depending on the economic situation.

The group said it was suffering from supply chain issues and the impact of exchange rates.

On the Nasdaq, Pinterest was highly sought after (+15.21%) after slightly better than expected results and a stable number of users (433 million) despite the difficulties of advertisers.

The rise of an activist shareholder, Elliott Investment Management, which supports the management of the social network also gave investors confidence.

The airline JetBlue (-7.39%) took a nosedive after announcing a much stronger than expected loss caused in particular by rising kerosene costs as the company prepares to complete the takeover of Spirit after a bitter battle with its competitor Frontier.

Other results were expected including Starbucks, Paypal, Airbnb and semiconductor maker AMD.

The VIX index, nicknamed the “fear index”, which measures market volatility, resumed its race forward.

However, assured Peter Cardillo, “the market is not moving, in my opinion, towards a new descent to the bottom”. “I think all these concerns will fizzle out and the recovery will continue in August,” he said.

Ten-year bond yields rose a little to 2.61% from 2.57%.