The visit of the Speaker of the House of Representatives Pelosi to Taiwan as part of his trip to the Indo-Pacific countries increased the tension in the markets as well as the US-China relations.
With these developments, Asian stock markets fell sharply, while the Shanghai composite index was 2.26 percent, the Nikkei 225 index was 1.4 percent in Japan, the Kospi index was 0.52 percent in South Korea and the Hang Seng index was 2% in Hong Kong. .67 depreciated.
In Taiwan, which is at the center of geopolitical debates, the index also decreased by 1.56 percent.
Tensions between the US and China also increased the pressure on the currencies of China and Taiwan. Taiwan dollar is at its lowest level since May 2020.
The Japanese yen, on the other hand, rose slightly against the dollar due to the safe-haven effect. The dollar/yen parity increased by 0.53 percent to 132.3 as of 19.00 TSI.
Mixed trend prevails in New York stock market
The New York stock market in the USA is also following a mixed course after the day started with a decline with the developments regarding Pelosi's visit to Taiwan.
At the opening, the Dow Jones index lost 0.33 percent, the S&P 500 index 0.35 percent and the Nasdaq index 0.66 percent. However, S&P 500 and Nasdaq indices showed an upward movement after the opening.
With the rise of tension between the USA and China over Taiwan, the dollar index and gold rose.
The dollar index rose by 0.47 percent to 105.8 as of 19.00 TSI.
An ounce of gold also climbed to $1,793.80 with an increase of 0.35 percent in the same minutes in international markets.
The US 10-year bond yield, on the other hand, followed an upward trend and rose to 2.70 percent.
European stock markets closed with decline
On the European side, the steps to be taken by the European Central Bank (ECB) in the face of Russia-Ukraine tension, energy crisis and high inflation remained at the center of the agenda.
DAX 40 index lost 0.23 percent in Germany, CAC 40 index lost 0.42 percent in France and FTSE MIB 30 index lost 0.35 percent in Italy. In the UK, the FTSE 100 index decreased by 0.06 percent.
The euro/dollar parity, on the other hand, declined after testing 1.03, the highest level of about a month, and traded at 1.02 with a decrease of 0.53 percent.
Tensions between the US and China have risen at a time of recession concerns in the markets
Analysts stated that Pelosi's visit to Taiwan caused tension in the markets despite the threats from China.
Analysts pointed out that the already tense relations between the USA and China could deteriorate with Pelosi's visit, and noted that the tension in the region increased at a time when there were concerns about the global economic recession.
After the plane carrying Pelosi and the 5-member Congress delegation arrived in Taiwan, harsh statements came from China.
In a statement made by the Chinese Ministry of Foreign Affairs regarding the visit in question, "This behavior is extremely dangerous, like playing with fire. Playing with fire will burn himself." statement was included.
The visit, despite Chinese opposition and protests, seriously violated the principle of "one China" and the commitments in the Three Joint Declarations, which form the basis of China-US diplomatic relations, the statement said.
Military activity increased in the region due to Pelosi's visit to Taiwan
Rumors that Pelosi would visit Taiwan as part of her trip to Indo-Pacific countries had caused tension in US-Chinese relations.
China's Ministry of Defense, in a statement last week, warned that if Pelosi's visit takes place, it could respond militarily and said, "If Pelosi visits Taiwan, the Chinese army will not stand idly by." had used the phrase.
Regarding the possible visit, the Chinese Foreign Ministry said, "We are prepared for any eventuality. If the US side insists on the visit, we will take strong and determined measures to protect our sovereignty and territorial integrity." had evaluated.
Due to the possible visit, the military activity of the US and Chinese armies near Taiwan had increased.
82-year-old Pelosi's planned visit to Taiwan in April was canceled on the grounds that she caught Kovid-19.
Chinese Foreign Minister Wang Yi warned at the time that Pelosi's visit to Taiwan would mean "crossing the red line" defined by the "one China" principle.
Pelosi became the first Speaker of the US House of Representatives to visit the Island in 25 years. Earlier in 1997, Newt Gingrich had visited Taiwan while on this mission.
Comments
No comment yet.