Geopolitical Tensions Shake Wall Street as Trump Questions Taiwan Defense

Geopolitical risks reverberated through Wall Street after U.S. presidential candidate Donald Trump expressed uncertainty about defending Taiwan, causing chipmaker shares to tumble and gold prices to hit record highs. The S&P 500 dropped 1%, with Nvidia and ASML seeing significant declines. Currency markets also experienced notable swings.

Geopolitical risks reverberated through Wall Street on Wednesday after U.S. presidential candidate Donald Trump expressed uncertainty about defending Taiwan. His comments sent chipmakers' shares plummeting and gold prices to new heights.

Futures tracking the U.S. S&P 500 equity benchmark fell by 1%, following a recent record high. Notably, Nvidia stocks dropped 3.1% during pre-market trading, while Taiwan's TSMC closed 2.4% lower. The largest chipmaking equipment supplier, the Netherlands' ASML, saw a 7.7% dip in European trade.

The tech sector downturn was amplified by Trump's remarks in a Bloomberg Businessweek interview, questioning U.S. support for Taiwan and suggesting the island should pay for American protection. His stance cast doubts over U.S. support for strategic allies, already indicated by his choice of Ohio Senator J.D. Vance as running mate.

(With inputs from agencies.)