Wall Street Tech Plunge Sends Global Markets Lower

Wall Street indexes closed lower on Tuesday, sparking a downturn in Asian markets that spread into Wednesday afternoon.  The declines on Wall Street were led predominantly by sweeping losses in the popular FAANG stocks which have been under pressure in recent days since the Cambridge Analytica scandal broke last week, sending Facebook share prices down over 10 percent.  Tuesday’s down day on Wall Street broke what investors had hoped would be a rally prompted by easing trade tensions.

The Nikkei 225 was down 1.93 percent as of 1:33 p.m. HK/SIN and Hong Kong’s Hang Seng Index was down 1.68 percent.  Both the Shanghai Composite and South Korea’s Kospi were also down over 1 percent in the early afternoon, pressured by declines in the technology sector.

Despite the latest struggles in the global stock markets, a poll of 1,321 respondents released by Wells Fargo and Gallup on Tuesday indicated that investor confidence is at a 17-month high and that 60 percent of respondents are optimistic about the market’s direction within the next year. 

The dollar was searching for direction on Wednesday, easing modestly against most of it primary trading partners after gaining overnight.  The greenback was pressured by performance on Wall Street but traders remained optimistic that cooling tensions between the U.S. and China could send markets higher.  All eyes are now on the U.S. GDP data which is expected later today.

The dollar was marginally higher against the yen, trading at 105.53 after nearing the 106 level overnight.  The dollar continued to struggle against the euro, trading at $1.2406, a 0.04 percent move.