Biden hits chipmakers, USD selloff accelerates, ECB meets | MarketTalk: What’s up today? | Swissquote

Show notes

While everyone is speculating on how the ongoing international trade war could worsen if Donald Trump returns to the White House, it was Joe Biden who delivered a blow to the market yesterday as his administration told allies that it’s considering severe restrictions if companies like the Japanese Tokyo Electron and Dutch ASML keep providing China the tools they need to access advanced chip technology. Chipmakers tanked and pulled major indices lower. Let’s see if earnings from Netflix and TSM could put a smile back on investors’ face and help TSM – which lost 8% yesterday – recover a part of these losses.
Yesterday’s big tech selloff hit sentiment in small caps too. The Russell 2000 gave back 1% as the US 2-year yield rebounded slightly on cautious comments from the Federal Reserve (Fed) Christopher Waller’s comments that the Fed is getting ‘closer’ to cutting rates but he needs more evidence that inflation is on a solid downside trajectory to back a concrete move.
The selloff in the US dollar index accelerated as the index pulled out a crucial Fibonacci support – the major 38.2% retracement on year-to-date rally. The move was helped by suddenly stronger Japanese yen (suspected to have benefited from a new FX intervention) and stronger Cable following yesterday’s stronger-than-expected inflation data from the UK. The EURUSD consolidates.
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