NEW YORK: Stock markets mostly fell Monday and the dollar slid on concerns that the collapse of US President Donald Trump's repeal of Obamacare could leave him struggling to push through his promised tax-cut and infrastructure spending policies.
In a severe early blow to the new administration, the healthcare reform was pulled Friday as it failed to win enough support among Trump's Republican party, which has a majority in both houses of Congress.
While the tycoon said he would now move on to tax reform, the failure of the bill -- which was seen as a litmus test for his ability to push through his economy-boosting agenda -- has led to concern about future policies.
"Stocks were under pressure on Monday following the collapse of Donald Trump's first attempt to overturn Obamacare," said Jasper Lawler, senior market analyst at LCP.
"For many, the healthcare bill has been the moment that crystallized the risk of economic failure under The Donald."
"Is the Trump honeymoon over?" asked Jameel Ahmad at FXTM.
The president's healthcare defeat "has made the markets begin to get nervous about what other possible hurdles Trump could potentially face when it comes to implementing other aspects of his campaign agenda," he said.
Equity markets in Europe and Asia fell, with the Nikkei in Japan suffering the deepest declines of the major bourses at 1.4 percent. The Nikkei's losses were compounded by the hit from a stronger yen on export-oriented companies.
US stocks opened sharply lower, but gained gradually throughout the session. In the end, the Dow and S&P 500 suffered modest declines, while the Nasdaq pushed into positive territory behind strong gains for some technology shares.
Wall Street investors in general viewed tax cuts as the most important aspect of the Trump agenda because of their capacity to boost corporate profits. Monday's trade suggested investors still believe a major tax bill could be enacted despite the health-care debacle.
"It's doing a lot better than I had originally expected it to be doing," said Sam Stovall, chief investment strategist at CFRA Research.
- Key figures around 2030 GMT -
New York - Dow: DOWN 0.2 percent at 20,550.98 (close)
New York - S&P 500: DOWN 0.1 percent at 2,341.59 (close)
New York - Nasdaq: UP 0.2 percent at 5,840.37 (close)
London - FTSE 100: DOWN 0.6 percent at 7,293.50 (close)
Frankfurt - DAX 30: DOWN 0.6 percent at 11,996.01 (close)
Paris - CAC 40: DOWN 0.1 percent at 5,017.43 (close)
EURO STOXX 50: DOWN 0.2 percent at 3,435.74
Tokyo - Nikkei 225: DOWN 1.4 percent at 18,985.59 (close)
Hong Kong - Hang Seng: DOWN 0.7 percent at 24,193.70 (close)
Euro/dollar: UP at $1.0865 from $1.0805
Pound/dollar: UP at $1.2562 from $1.2492
Dollar/yen: DOWN at 110.65 yen from 111.12 yen
Oil - Brent North Sea: DOWN 5 cents at $50.75 per barrel
Oil - West Texas Intermediate: DOWN 24 cents at $47.73 per barre
Comments
Comments are closed.