The Dow Jones Industrial Average (DJIA) is one of the world’s largest indices. It is comprised of the 30 largest companies in the United States like Apple and Microsoft. Today, its companies have a combined market value of more than $25 trillion.
This week, the Dow has lost almost 500 points which represents a value of tens of billions of dollars. The declines came as the US administration initiated tariffs on Chinese goods worth more than $50 billion. In response, the Chinese announced that they too would impose tariffs on American goods worth more than $50 billion. After the announcement, Donald Trump announced that he would impose tariffs on goods worth more than $400 billion.
This new front brings the two largest economies to their largest confrontation in decades. According to the Wall Street Journal, the Trump administration believes that it will win the war because China does more business in the US than US does with China.
Yesterday, another major news for the index was the booting of General Electric (GE) from the index. GE was one of the original companies in the index when it was established a century ago. In the past GE was the largest company in the world with holdings in industrial, finance, media, and other businesses. Today, GE is a shell of its former self and there are concerns of its survival. GE will be replaced in the index by Walgreens Boot Alliance.
The current decline on the Dow has made its chart form an inverted cup and handle position as shown below. This means that the index could continue falling especially if the current trade rhetoric continues. If it does, it will next aim for the $24,338 level.
The Dow Jones Industrial Average (DJIA) is one of the world’s largest indices. It is comprised of the 30 largest companies in the United States like Apple and Microsoft. Today, its companies have a combined market value of more than $25 trillion.
This week, the Dow has lost almost 500 points which represents a value of tens of billions of dollars. The declines came as the US administration initiated tariffs on Chinese goods worth more than $50 billion. In response, the Chinese announced that they too would impose tariffs on American goods worth more than $50 billion. After the announcement, Donald Trump announced that he would impose tariffs on goods worth more than $400 billion.
This new front brings the two largest economies to their largest confrontation in decades. According to the Wall Street Journal, the Trump administration believes that it will win the war because China does more business in the US than US does with China.
Yesterday, another major news for the index was the booting of General Electric (GE) from the index. GE was one of the original companies in the index when it was established a century ago. In the past GE was the largest company in the world with holdings in industrial, finance, media, and other businesses. Today, GE is a shell of its former self and there are concerns of its survival. GE will be replaced in the index by Walgreens Boot Alliance.
The current decline on the Dow has made its chart form an inverted cup and handle position as shown below. This means that the index could continue falling especially if the current trade rhetoric continues. If it does, it will next aim for the $24,338 level.
The post Dow Falls as Trade Conflict Continues appeared first on Forex.Info.
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