TOPLINE
The market ended lower on Friday as high-tech stocks lagged, and stocks were hit as well after China retaliated for the closure of its consulate in Houston earlier this week by ordering States United that you close your consulate in Chengdu.
Relations between the United States and China hit a new low on Friday.
KEY FACTS
The Dow Jones Industrial Average fell 0.7%, nearly 200 points, on Friday, while the S&P 500 fell 0.6% and the Nasdaq Composite, made up of heavy technology, 0.9%.
The market was hit by worsening tensions between the United States and China, which reached a low point after Beijing on Friday ordered the closure of a US consulate in Chengdu.
The Chinese Foreign Ministry said the order was a “legitimate and necessary” response to the Trump Administration’s decision to close the Chinese consulate in Houston earlier this week.
Meanwhile, big tech stocks continued to decline and dragged the market lower for the second day in a row: Facebook, Apple and Microsoft fell.
Intel shares plummeted more than 16% after the company, despite beating last quarter’s profit and revenue estimates, indicated that it expects more delays in its next-generation chips.
Crucial quote
“While traders weren’t able to get enough big technology last week, they can’t get away from it fast enough this week,” Bespoke Investment Group said in a recent note.
Surprising fact
Spot gold traded above $ 1,900 for the first time since 2011. Investors have been quick to seek safe assets like gold amid continued uncertainty about the coronavirus pandemic and tensions between the United States and China.
What to look at
Republicans in Congress are expected to unveil a new coronavirus relief plan early next week. With the additional $ 600 a week in federal unemployment benefits due in late July, lawmakers in Washington are struggling to agree on the next round of coronavirus aid. The next stimulus round is likely to include a second round of stimulus checks, more money for PPP loans to small businesses and funds for schools in the fall.
Further reading
Apple, Microsoft, Amazon, Google and Facebook make up a record portion of the S&P 500. Here’s why it could be dangerous. (Forbes)
Dow Sinks 350 Points After Another 1.4 Million Americans Apply For Unemployment (Forbes)
Dow raises 150 points amid renewed tensions between the US (Forbes)
We look at how the stock market behaved under every US president since Truman, and the results will surprise you. (Forbes)
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