Treasury bonds rise, Wall Street falls, and the chip maker war reaches a tipping point.
The slide on Wall Street continues this week, and things are getting out of control as the probabilities of a slowing economy jump higher. The energy crisis in Europe is adding extra pressure on oil and natural gas prices.
The tension between the United States and Saudi Arabia has reached a tipping point, and the semicolon war between the world’s two largest economic forces is intensifying. Between all these events and factors, investors are betting on corporate earnings, yet experts and initial reports show a lid on earnings in the third quarter.
According to the Wall Street Journal, 10-year treasury yields in the United States have risen above 4.1%, raising concerns about the impact on the housing market.
After two days of gains, the S&P 500 is down 1% today, the Nasdaq is down 1.09%, and the Dow Jones industrials are down 0.60%.
The world’s largest electric car manufacturer and seller anticipates a massive increase in unit sales in the coming days. Despite stock market concerns, Netflix outperforms the market by increasing its share price by 13% yesterday. The company delivered an outstanding profit report and its executives shared the company’s new plan to crack down on user-sharing issues.
This week has shown inverters mixed corporate earnings. For instance, Abbot Laboratories shares sank by 8% after releasing a disappointing earnings report. On the other hand, the Chinese giant company Mogu Inc.’s shares jumped. United Airlines holding also saw an increase in its shares after a better-than-expected earnings report.
For this week, it seems that Netflix and the United Airlines holding are what are lifting Nasdaq and tech stocks from falling further. Marketers are looking for other tech and corporate reports to at least balance or cover today’s losses.
Between this and that, the United States is fighting an exhausting war: inflation, the energy crisis, the war in Eastern Europe, and the chip war. For the time being, the United States enjoys 45% of total southeastern imports, but its nearest rival and competitor are growing at an unusual and frightening rate.
In only 10 years, China’s semiconductor industry activities rose by double, and the number is expected to increase significantly in the next 10 years. China and the United States understand that the chip manufacturing industry is the foundation of the modern economy, and the country with the largest market share will dominate the global economy. That explains why China is forcing its way to get Twain, considering that Taiwan is the world’s largest chip maker and provider. On the other hand, the U.S is using all available tools and methods to prevent that from happening.
Chinese companies are turning to the local market and voluntarily delisting themselves from the New York Stock Exchange.
So, the question that reveals itself here is, can the U.S administration win the multiple-front war or will these fights cause a worse-than-expected recession?