PARIS (Reuters) – The New York Stock Exchange opened lower on Tuesday in a context of worsening tensions between Ukraine and Russia, which has changed its military doctrine on the use of atomic weapons, which tempers the appetite for risk and pushes investors towards safe haven assets.
In early trading, the Dow Jones index lost 314.98 points, or -0.73%, to 43,074.62 points. The broader Standard & Poor’s 500 fell 31.53 points, or 0.53%, to 5,862.09 points.
The Nasdaq Composite lost 93.67 points, or 0.50%, to 18,698.13 points.
Russian President Vladimir Putin on Tuesday approved a new nuclear doctrine expanding the possibilities for Russia to use atomic weapons, particularly if the country were to be the subject of a conventional attack supported by a nuclear-armed state . At the same time, Russia accused Ukraine of having fired American long-range ATACMS-type missiles into its territory.
“All over the world we are nervous because Putin has said that if the situation gets worse, he might do the same. The markets are reflecting that nervousness,” says Kim Forrest, chief investment officer at Bokeh Capital Partners.
In the bond market, nervousness is reflected in a rush towards sovereign bonds, considered safe assets, which lowers their yield. The American ten-year yielded 4.1 basis points, to 4.3726%.
The CBOE volatility index, which briefly rose to 17.93 points, reached its highest level since the American election on November 5, before falling slightly to 16.96.
The resurgence of geopolitical tensions adds to a context that is already unfavorable for risk-taking. The market awaits Wednesday the results of Nvidia (+0.90%), a barometer of the enthusiasm around artificial intelligence (AI). He also monitors key investor nominations (Treasury Secretary and Trade Representative) in the incoming administration of President-elect Donald Trump.
In stocks, defense groups like RTX Corp (+0.67%) and Lockheed Martin (+1.05%) are sought after, as are stocks linked to gold, a safe haven asset.
In today’s financial results, Walmart advances 2.22% after raising its annual sales and profit forecasts. The forecasts of Amer Sports (+30.82%) are also welcomed.
Super Micro Computer climbs 23%, the group having submitted a proposal to Nasdaq to avoid delisting.
(Written by Claude Chendjou, edited by Augustin Turpin)
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