New York Stock Market Weakens on Capital Gains Tax Hike... Cryptocurrency Also Plummets (Comprehensive)

Bitcoin Hits $51,000... Dogecoin Plummets to 28 Cents

[Image source=Reuters Yonhap News]

[Asia Economy New York=Correspondent Baek Jong-min] The major indices of the New York stock market fell sensitively in response to the Biden administration's plan to raise the capital gains tax rate. Cryptocurrencies such as Bitcoin and Dogecoin also plunged simultaneously.

On the 22nd (local time), the Dow Jones Industrial Average closed at 33,815.90, down 321.41 points (0.94%), the S&P 500 index fell 38.44 points (0.92%) to 4,134.98, and the Nasdaq index dropped 131.81 points (0.94%) to 13,818.41.

The market showed mixed trends in early trading but took a direct hit in the afternoon from the U.S. government's plan to significantly raise the capital gains tax rate.

U.S. media reported that President Biden plans to raise the capital gains tax rate for high-income earners making over $1 million from the current 20% to 39.6%. This is to fund the $1 trillion 'American Families Plan' scheduled for next week.

The increase in the capital gains tax rate could reduce stock trading by the wealthy, acting as a negative factor for the stock market.

News that India's new COVID-19 cases exceeded 310,400 in the past 24 hours, marking the highest daily new cases since the pandemic began, was also perceived as negative.

American Airlines' stock fell more than 4% after reporting a net loss of $1.25 billion. Southwest Airlines expected to break even by June but fell 1.6% as sales fell short of expectations.

Casino operator Las Vegas Sands also dropped 4%.

Telecom company AT&T rose more than 4% on better-than-expected results, including strong subscriber growth for its subsidiary streaming service HBO Max.

As cryptocurrency prices plunged, cryptocurrency exchange Coinbase fell 5.9% that day, dropping below $300 for the first time since its listing. Coinbase's closing price was $293.45. Tesla's stock also fell by over 3%.

Bitcoin fell 6% that day, dropping to the $50,100 range, and Dogecoin traded down 15% at 26 cents.