(CercleFinance.com) – As expected, Wall Street opened lower on Monday morning as investors worried about the potential impact on the economy of the protests against the zero Covid policy in China.
At the end of the morning, the Dow Jones fell 0.7% to 34,100.2 points, while the Nasdaq Composite dropped 0.8% to 11,137.2 points.
The social tensions that have affected the cities of Beijing, Shanghai, Hangzhou, Wuhan and Urumqi since this weekend have revived investors’ risk aversion in favor of government bonds, among others.
Some specialists note that criticism of China’s management of the coronavirus epidemic could, however, force the country to review its roadmap for the coming months.
“Analysts currently expect the Chinese economy to reopen in April 2023, after the next National People’s Congress,” write Wells Fargo teams.
“Despite this, some professionals believe that there is a good chance that the Chinese economy will reopen before this date, with the zero Covid policy ultimately proving to be far too costly,” says the Californian bank.
Apple thus stumbles by 2%, affected by fears that iPhone production will suffer from the demonstrations and strikes currently rocking the country.
Government bonds are benefiting from the general decline in assets deemed the safest, which is reflected in a drop in benchmark yields: that of ten-year Treasuries thus fell to 3.68%, the lowest since the beginning of October.
The Chinese tumult weighs on the oil market and adds to the concerns that were already surrounding the state of demand with the slowdown in the global economy.
American light crude (West Texas Intermediate, WTI) fell 1.2% to 75.3 dollars.
Gold does not benefit from its status as a safe haven and fell 0.3% to 1.743 dollars an ounce, as did the greenback, which vegetated around 1.0390 against the euro.
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