US and China Tensions Are Affecting Global Markets

Global Markets: US-China Tension Rises Again

Wall Street indices declined on Wednesday after the Trump administration evaluated a ban on the purchase of critical software from China. The S&P 500 index closed the day down by 0.5%, while the Nasdaq 100 lost 1% due to disappointing expectations from Texas Instruments and a 10% drop in Netflix.

Tesla's Performance Stands Out

Tesla Inc.’s profits have started to decline as rising costs overshadow record vehicle sales. The company's shares fell by 3.8% in after-hours trading in New York.

Decline in Asian Markets

Asian markets recorded a decline in the morning hours. The MSCI Asia stock index fell further from its record close earlier this week, led by Japanese stocks.

Expected Increase in Oil Prices

The US's planned sanctions on Russia's largest oil producers have raised supply concerns, leading to an increase in oil prices. Brent crude rose by 3% to over $64 per barrel in Thursday morning trade.

Continuous Decline in Gold

Investor concerns about the market overheating after gold prices reached record levels have caused gold prices to fall to $4,000 per ounce. Spot gold lost about 0.5% on Thursday, while the outflow from exchange-traded funds (ETFs) reached the highest level in the past five months.

Turnaround in Argentine Peso

As the US government continues its support initiatives for Argentina's ally Javier Milei ahead of key votes, the Argentine peso ended its five-day downtrend with the active participation of Wall Street banks in the local currency market. JPMorgan Chase & Co. and Citigroup Inc. confirmed their activity in Argentina's spot market, while it is estimated that the US Treasury intervened with between $400 and $500 million.

Consensus: Expectations on Inflation Data

Investors are awaiting the US consumer inflation data to be released on Friday, while the dollar index remained within a narrow range. Nick Twidale, Chief Market Analyst at AT Global Markets, stated, "It would take a major surprise for the Fed to change its expectation of a 25 basis point rate cut next week, but inflation data could significantly impact expectations for the yield curve."