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Tech selloff dents global stocks; dollar rallies

➤ Global shares tumble as tech stocks slump.

➤ Toshiba resumes some supplies to Huawei after temporarily suspending shipments.

Sterling falls amid growing calls for U.K. PM to step down.

➤ Narendra Modi's party set to win India general elections.

The reported U.S. threat of blacklisting more Chinese tech companies continued to drag stock markets lower May 23, with Wall Street tracking losses from Europea and Asia.

S&P 500 and Nasdaq 100 opened nearly 1% and 1.2%, respectively, lower.

The Shanghai SE Composite tumbled 1.4%, dragged down by a 2.8% decline in technology stocks. Hong Kong's Hang Seng index lost 1.6% and Japan's Nikkei 225 fell 0.6%.

Hangzhou Hikvision Digital Technology Co. Ltd.'s shares lost 5.8% as it was among the Chinese surveillance firms which the U.S. was considering to blacklist after a similar move against Huawei Technologies Co. Ltd. was recently scaled back.

Meanwhile, Toshiba Corp. said it was suspending electronic device shipments to Huawei, the Nikkei Asian Review reported. The Japanese company later said it had resumed some supplies, Reuters reported.

The U.S. appears to have convinced Japan and certain European countries not to use Chinese technology products or sell technology products to Chinese companies, according to ING Research, to prevent Beijing from becoming a global tech leader.

However, China could react by banning rare earth element exports to the U.S., hold fewer Treasurys or further reducing taxes for integrated circuit design and software development companies, ING added.

The Mumbai Sensex reversed earlier gains, closing 0.8% down, as India Prime Minister Narendra Modi's Bharatiya Janata Party looked set to win the general election.

The Stoxx Europe 600 lost 1.2% around 9:30 a.m. ET, with the index's technology component shedding 1.9%. Infineon Technologies AG's shares plummeted 3.3%, ASML Holding N.V. fell 1.4% and SAP SE was down 1.2%.

Germany's DAX index shed 1.6%, France's CAC 40 dropped 1.6% and the FTSE 100 was down 1.3% around 9:30 a.m. ET.

Among currencies, the safe-haven Japanese yen appreciated 0.3% against the dollar, while the Chinese yuan fell 0.2%. The euro fell 0.3% against the dollar.

Sterling depreciated 0.3% versus the dollar amid growing calls for the U.K. prime minister to step down. The Times reported that U.K. Prime Minister Theresa May will announce her exit on May 24. U.K. House of Commons leader Andrea Leadsom stepped down from the government in opposition to the prime minister's proposed Brexit concessions, which includes a parliamentary vote on whether to hold a second referendum.

Meanwhile, May's Conservative Party looks set for a heavy defeat in the European Parliament elections beginning today, with only 7% support, according to the latest YouGov poll. As the U.K. faces an impasse regarding its path forward in the Brexit process, Nigel Farage's Brexit Party is proving to be popular, at 37% of the vote, while the Labour Party is at 13%, according to the poll.

The Conservatives' defeat may pave way for May's resignation, but it could take until September to find a successor, meaning Brexit is likely to be delayed further from the current Oct. 31 deadline, Danske Bank Research wrote.

In the bond market, Treasurys rose as 10-year yields dropped 3 basis points to 2.360% as of 9:30 a.m. ET.

Brent crude oil plummeted 2.7% to $69.11 per barrel on the ICE Futures Exchange, while gold ticked 0.4% higher.

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The day ahead:

9:45 a.m. ET — U.S. PMI composite flash (Econoday consensus: 52.4)

10 a.m. ET — U.S. new home sales (Econoday consensus: 680,000)

10:30 a.m. ET — U.S. EIA natural gas report

11 a.m. ET — Kansas City Fed manufacturing index (Econoday consensus: 6)

1 p.m. ET — U.S. Fed's Robert Kaplan, Tom Barkin, Raphael Bostic and Mary Daly speak

4:30 p.m. ET — U.S. Fed balance sheet and money supply