Markets Start Week in Sag Over Tensions with China
Markets started the week down in response to a growing war of words between the White House and the Chinese government, as well as recent moves by billionaire investor Warren Buffet.
CNBC reported that, as of 12:13 p.m., the Dow Jones Industrial Average was down by 200 points, while the S&P 500 had lost 0.3 percent of its value and the Nasdaq had actually made a slight 0.6 percent gain on surging tech stocks.
One factor driving today's figures was a recent decision by Warren Buffet's company to sell all of its airline holdings. Because Buffet is known as a long-term investor, his moves sent shock waves throughout the market as other traders interpreted his actions as an indication that the sector has deeper challenges that will take a while to recover from.
Also moving the market has been renewed finger-pointing between the United States and China, according to the Wall Street Journal. The international scuffle concerns the origins of the COVID-19 pandemic: the White House repeated accusations that Beijng deliberately downplayed the virus in its early stages, and added to that fresh allegations that it in fact came from a laboratory in Wuhan. Traders are reacting not necessarily to the accusation itself but to the increased tension the statements will create, further gumming up international trade.
The White House made its comments while Congress is busy negotiating the next aid package to prop up the economy amid widespread lockdowns. A key sticking point this time around is a liability shield for businesses that reopen. Republicans believe business owners won't be comfortable returning to normal unless they are reasonably sure they won't get sued by customers or employees if they made the wrong choice and people still get sick. Democrats have balked at this idea, saying it strips workers of vital protections. But the Journal notes that even if this is left out of the federal bill, many state governments have already implemented broad protections for health care providers and certain other employers.