Investors were reminded on Wednesday of both the prospective gains and the potential chaos that could come out of a second Trump administration, giving the recent rotation out of tech stocks an unsettling twist. Donald Trump said in an interview with Bloomberg Businessweek that Taiwan should have to pay for the U.S. to defend it, adding 'we’re no different than an insurance company.' This was disturbing to investors because the island democracy that China claims as its sovereign territory happens to be one of the most important technology hubs in the world, most prominently through its dominant position in global semiconductor production. Taiwan Semiconductor Manufacturing, the biggest contract chip maker in the world, shed 2.5% in Taiwan trading and then extended those losses, with its U.S-traded depository receipts ending the day down 8.0%. Other chip companies, for whom TSMC is a major supplier and Taiwan a critical supply-chain base in more ways than one, fell as well. Nvidia fell 6.6% and the PHLX Semiconductor Index plunged 6.8%. Trump alone wasn't to blame. Bloomberg also reported on Wednesday that the Biden administration is considering new restrictions on sales of chip-making equipment to China, hitting shares of ASML. The manufacturer of machines that make semiconductors is Europe's largest technology company, and happened to report results on Wednesday showing record levels of revenue from China. Its Netherlands-traded shares plummeted by 10.9%. Still, other corners of the market continued to seem excited about potential tax and regulatory relief if Trump is elected. As Heard's David Wainer notes, insurance companies stand to benefit from a lighter touch on Medicare Advantage. UnitedHealth Group, the nation's biggest health insurer, led gains in the Dow Jones Industrial Average for the second straight day, rising 4.5%. That helped the Dow end 244 points higher, or 0.6%, even as the S&P 500 fell 1.4% and the Nasdaq slid 2.8%. Here’s what else Heard on the Street was watching: Live Markets Snapshot Crude oil, Bitcoin USD and gold continuous contract data refresh every time you open this email. Other data are as of market close.
TIAA is the lifetime income leader. Accelerating retirement rates and longer lives are fueling the American retirement crisis. Women retire with 30% less income vs. men and can live up to 30 years after they stop working. 54% of Black Americans haven’t saved to maintain their standard of living in retirement. TIAA is the lifetime income leader, with solutions for not-for-profit and corporate markets, prepared to combat this crisis. Would Trump Ease Up on Medicare? Wall Street Thinks So. By David Wainer Many healthcare investors have a clear favorite when it comes to the presidential race: Donald Trump. In recent weeks, as Trump has expanded his lead with a majority of voters saying President Biden is too old to run for a second term, Wall Street has started to speculate on what a Republican sweep of the executive and legislative branches could mean for health insurers. Some are betting that the $450 billion Medicare Advantage industry could be ripe for regulatory easing. More than a year ago, the Journal's Evan Gershkovich was arrested in Russia while on a reporting trip and falsely accused of espionage—a charge that he, the Journal and the U.S. government vehemently deny. Follow the latest coverage, sign up for an email alert, and learn how you can support Evan at wsj.com/evan. Geopolitics Crash the Party at ASML By Stephen Wilmot The persistent strength of ASML’s business in China is getting awkward. Europe’s most valuable technology company, which manufactures machines that make microchips, reported second-quarter results Wednesday. One crucial detail: Revenue from system sales to China rose 20% on the quarter and accounted for 49% of the total—on a par with the record share in the January-to-March period. In Brief Lenders to consumers have tightened their belts too. Enjoying this newsletter? Get more from WSJ and support our journalism by subscribing today with this special offer. Today's Markets News Wind Turbine Break Hits GE Vernova Carlyle and KKR Win $10 Billion Student Loan Portfolio Real-Estate Meltdown Strains Even the Safest Office Bonds 📅 What's Coming Up Companies reporting earnings Thursday include the world's largest chipmaker Taiwan Semiconductor Manufacturing, as well as Netflix, Abbott Laboratories and Blackstone. About Us
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