Chinese Stocks Drop on Xi’s Power Grab

The stock market is up again today but given the level of recent volatility, who knows how long that will last? At one point today, the S&P 500 was up more than 1.17%. We’ve already given most of that back.

We’ve been in an unusual stretch where all the up days have been up by a lot. In the last 24 trading sessions, the S&P 500 has been up just seven times, but all of those times have been by more than 1%. Five of the seven were up by more than 2.3%.

Many Chinese stocks are getting walloped today. This comes on the news that Xi Jinping will be heading to a third term as president of China. The precedent has always been two terms. The Hang Seng index is having its worst day since 2008.

Shares of Tesla dipped below $200 earlier today. That’s the lowest they’ve been since June 2021. At its peak, Tesla was at $414.

The market is leaning strongly to the conservative stocks today. The S&P 500 Low Volatility Index is up 0.84% while the High beta Index is -0.40%.

Daniel Pinto, the president of JPMorgan Chase, said that a recession may be the price we have to pay in order to defeat inflation. He grew up in Argentina and remembers the severe inflation they had.

In Britain, Rishi Sunak will become the new prime minister. The pound rallied against the dollar. Last month, the pound got down to $1.07.

Posted by on October 24th, 2022 at 11:19 am


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