Stock Market Today: Global Stocks Fall Mostly as Dip in Big Tech Stocks Hit Wall St’s Rally

TOKYO – Global stocks were mostly down on Thursday, with Tokyo’s benchmark index falling more than 2%, after Wall Street’s record rally hit a wall of concerns about the potential worsening of trade tensions with China.

France’s CAC 40 fell less than 0.1% in early trading to 7,568.18. Germany’s DAX fell nearly 0.2% to 18,407.74. Britain’s FTSE 100 rose 0.7% to 8,243.50. U.S. stocks were expected to be mixed, with Dow futures falling nearly 0.1% to 41,469.00, while the S&P 500 futures rose almost 0.2% to 5,648.25.

Japan’s Nikkei 225 index ended down 2.4% at 40,126.35.

The markets’ spotlight was squarely on chip companies after a Bloomberg News report said U.S. President Joe Biden is considering the toughest trade restrictions available if companies like the Netherlands ASML and Japan’s Tokyo Electron continue to ship advanced semiconductor technology to China.

The US government has blocked Chinese access to advanced chips and the equipment to manufacture them, citing security concerns, and urged its allies to follow suit.

Technology-related stocks weighed on Tokyo trading. Shares of Tokyo Electron plunged 8.8% and shares of chip equipment maker Advantest tumbled 4.9%. fell 6.3%.

The strengthening yen has also raised concerns about exporter holdings in Japan, as a weak yen is a boon for the country’s export giants such as Toyota Motor Corp.

The US dollar rose to 156.28 Japanese yen from 156.19 yen. It traded above 161 yen for most of last week but has fallen in recent sessions. The euro was priced at $1.0936, down from $1.0941.

Recent currency fluctuations are the result of the US political position taking “center stage”, according to Tan Jing Yi of Mizuho Bank. Former US President Donald Trump has expressed concerns about an excessively strong dollar as a disadvantage for the US as it makes US-made goods relatively more expensive in foreign markets.

Japan recorded a trade surplus in June, the first in three months, highlighting a recovery in exports, according to data from the Ministry of Finance. In the first six months of this year, Japan’s trade deficit shrank by more than half compared to the same period last year, to 3.23 billion yen ($21 billion).

Elsewhere in Asia, Hong Kong’s Hang Seng gained 0.2% to 17,778.41. The Shanghai Composite Index rose 0.5% to 2,977.13.

Investors are awaiting policy news to help accelerate The slowdown in China’s economy as a high-level meeting of the ruling Communist Party ends in Beijing on Thursday.

S of Australia&OP/ASX 200 fell 0.3% to 8,036.50. South Korea’s Kospi fell 0.7% to 2,824.35.

Taiwan’s Taiex lost 1.6% while chipmaking giant TSMC plunged 2.4% after losing 8% overnight in US trading.

In addition to concerns about new controls on sales of chips and equipment to China, Taiwan stocks fell after Trump criticized the self-governing island claimed by Beijing, to which the US is required by law to supply defensive weapons.

“Taiwan should pay us for defense,” Trump said, according to a transcript of an interview published by Bloomberg. “Taiwan took our chip business away from us, I mean how stupid are we?” he said.

In energy trading, benchmark U.S. crude rose 82 cents to $83.67 a barrel. Brent crude, the international standard, rose 61 cents to $85.69 a barrel.