U.S. markets ended in the negative territory on Thursday as investors carefully evaluated a whistleblower complaint against President Donald Trump and the latest U.S.-China trade developments. Wall Street also felt the weight of Trump’s early-morning tweet on Thursday, in which the president warned of a stock market crash.
The Dow Jones Industrial Average declined 0.3% to close at 26,891.12 on Sep 26. The broader S&P 500 and Nasdaq Composite took the road south as well, sliding 0.2% and 0.6% respectively. The former closed at 2,977.62 and the latter finished the day at 8,030.66. The fear-gauge CBOE Volatility Index (VIX) declined 1.8% to close at 15.67 on Thursday. Finally, decliners outnumbered advancers on the NYSE by a 1.42-to-1 ratio.
Whistleblower Report Against Trump on Ukraine Phone Call
On Sep 26, Trump warned of a stock market meltdown if the Congress managed to successfully impeach him. Trump’s tweet followed a day after a rough transcript of his phone call with Ukraine President Volodymyr Zelensky on July 25 was released.
The transcript showed him asking Zelensky to investigate the activities of the President’s main domestic political rival Joe Biden and his son Hunter Biden. A whistleblower complaint soon followed the president’s tweet, which cited Trump using the power of his office to attain foreign interference in the 2020 U.S. elections.
U.S. stocks had ended in negative territory on Sep 25 as well, fearing a possible impeachment could damage the economy. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
US Unlikely to Renew a Huawei Waiver
Tensions lingered over U.S.-China relations as reports surfaced that the United States might not allow U.S. companies supply telecommunications company Huawei Technologies. The Chinese company had been blacklisted by the Trump administration in May.
Economic News
According to a final estimate by the U.S. Bureau of Economic Analysis, real gross domestic product rose 2% in Q2 2019. The growth rate was at par with the second estimate of real GDP released in August. Real GDP had increased by 3.1% in Q1 2019.
In other economic data, initial claims for the week ended Sep 21 came in at 213,000. The figure witnessed an increase of 3,000 from the prior week’s (week ended Sep 14) revised level.
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