After two days of backtracking, Pelosi’s exit from Taiwan puts Wall Street in good shape
Wall Street opened on positive ground, with tensions between China and the United States easing after House Speaker Nancy Pelosi’s visit to Taiwan later Tuesday.
Pelosi promised that “the United States will not abandon Taiwan,” affirming its support for the democratically elected government in Taipei, despite new threats from China claiming that Taiwan is an inalienable part of the People’s Republic of China.
The Dow Jones Industrial Average rose 0.77% to 32,646.12 points, while the global benchmark S&P 500 Index rose 0.83% to 4,125.12 points. The Nasdaq Technology Index advanced 1.23% to 12,497.10 points. The Nasdaq and S&P 500 both saw declines in the early days of this week, after their best month in two years was in July.
Investors are also assessing the US Federal Reserve’s “forecast”, which was released this Tuesday, after four members indicated there were no signs of slowing inflation. San Francisco Federal Reserve Chair Mary Daly said governors remain “resolutely and fully united” on their goal of bringing inflation back to 2%.
Analysts at RBC Capital Markets consulted by Bloomberg point out that although the second-quarter earnings season was better than expected, this could raise the risks of “overselling” in anticipation of downward revisions for the second half of the year. as happened with Advanced Micro Devices (AMD), which canceled Tuesday’s gain when it rose about 3%, after citing a lower-than-expected sales forecast in the second half of the year.
On the other hand, PayPal gained 11.48%, after Elliot Investment Management Fund announced that it had become one of the largest shareholders in the company and that the recent cost cuts would allow the company to save about $900 million this year.
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