NASDAQ Drops After New Chinese Tech Board News
NASDAQ stocks went down after taking a hard jab from Shanghai’s Tech Exchange. China’s new Science and Technology Innovation Board worried American NASDAQ investors.
The NASDAQ 100, the index for the 100 largest technology companies in the US, fell 3.60% or 277.11 points from its previous close.
All the 100 companies struggled to hold their ground after the news. The companies with the biggest loss are Ctrip.com, Wynn Resorts, Baidu, and Jd.Com Inc Adr. Three from the said companies that had the biggest drop are Chinese-owned enterprises.
The travel servicing company, Ctrip.com, went down 8.07% or 2.94 points. Wynn Resorts, the Nevada-based operator of high-end hotels and casinos, dropped 7.18% or 8.60 points.
Internet servicing company Baidu lost 7.06% or 7.61 points. And Jd.Com Inc Adr, formerly known as 360buy, declined 6.57% or 1.8 points.
The NASDAQ composite or IXIC, the index tracking all the tech companies in the states, also dipped. The IXIC dived 3.47% or 278.03 points.
The new Shanghai-based board is modeled from the US NAQDAQ stock market. However, critics are skeptical and scrutinizing the board.
China’s new board immediately surged in its first trading, averaging 140% in the session. But on its second day, the shares only gained half and some prices declined an average of 9%.
Some analysts are saying that the companies focused more on short-term gains instead of possible fundamentals in the long run.
Trade War Exhaustion
The escalating trade war, that turned into a currency war, also weighed on NASDAQ. Aside from the tech index, all major stock indexes in the US dropped in today’s trading.
The S&P 500 lost 2.98% or 87.31 points and the Dow 30 fell 2.90% or 767.27 points. The three indexes recorded their worst fall for this year.
Their fall started when the Chinese government allowed the yuan to deplete as a countermeasure against Trump’s tariffs. The move was followed by another strike from Chinese officials who suspended the purchasing of US farm goods.
Last week’s negotiation in Shanghai, China did not go as planned as Trump lashed out on Twitter to release his frustrations. The US President announced a new round of tariffs that pushed China to drop its nice-guy act.
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