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Stocks - Wall Street Slumps Again on U.S.-China Tensions

Stock Markets Oct 08, 2019 05:11PM ET
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Investing.com – Stocks fell for a second-straight day as worries about the U.S.-China trade talks, set to begin this week, proved strong enough to stall a recovery bid.

The S&P 500 finished down 1.56% just after hitting its low on the day. The Dow Jones industrials, which had fallen as many as 338 points early in the day, finished down 1.2%, or 314 points. The Nasdaq Composite fell 1.67%.

Scientific-equipment makers like Boston Scientific (NYSE:BSX) slumped in the selloff. Chip and biotech stocks were among the hardest-hit groups. The Philadelphia Semiconductor Index slumped more than 3% because so much of chipmakers' business has been tied to growth in sales growth in China. The Nasdaq biotechnology index fell about 2% because of a weak earnings report from Qiagen (NYSE:QGEN).

Banks dropped more than 2%.

The decline left the S&P and Dow more than 4% off from their summer peaks.

The Nasdaq is off nearly 6%. In six trading days in October, the S&P 500 and Dow are down 2.8%. The Nasdaq is off 2.2%.

Because of all the volatility that's hit markets in the last 12 months, the S&P 500 is off 1.63% from its 2018 peak, with the Dow off 2.9% from its year-ago peak and the Nasdaq down 3.8%.

China was the big weight on the market, starting with last night's announcement that the Trump Administration won't let eight Chinese companies and a number of police departments buy technology products that can be used in surveillance.

Tuesday afternoon, the U.S. said it will impose visa bans on Chinese communist party officials linked to abuse in China's Xinjiang province, where some million ethnic Uighurs have been put in detention camps.

The China news offset a positive reaction to Federal Reserve Chairman Jerome Powell's announcement the central bank will be buying securities to provide enough liquidity in the banking system.

Walmart (NYSE:WMT) was the sole Dow stock that showed a gain for the day. Microsoft (NASDAQ:MSFT) and Apple (NASDAQ:AAPL) were both down about 1%. Chemical maker Dow Inc (NYSE:DOW) was off nearly 3%. Cisco Systems Inc (NASDAQ:CSCO), JPMorgan Chase & Co (NYSE:JPM) and IBM (NYSE:IBM) were off more than 2%.

Boeing (NYSE:BA) was briefly ahead on the day, but ended down 0.65%. While it announced an order for a single 737 Max jet liner, there's no clarity on when the plane will fly again. At the same time, deliveries were halved because of the grounding of the plane. In addition, Boeing reported cancellations for 22 of its 787 Dreamliners.

Interest rates moved up during Powell's speech, but fell back at the close. The 10-Year Treasury yield finished at 1.534%, down from Monday's 1.553%.

Oil prices moved lower. West Texas Intermediate and Brent oil futures closed at levels last seen in mid-August. Gold futures rose slightly.

CBOE Global Markets (NYSE:CBOE), communications equipment maker Motorola Solutions (NYSE:MSI) gold producer Newmont Goldcorp (NYSE:NEM) and defense contractor L3Harris Technologies (NYSE:LHX) were among the leading S&P 500 performers.

Scientific instrument makers Waters (NYSE:WAT), PerkinElmer (NYSE:PKI), Boston Scientific (NYSE:BSX) and Thermo Fisher Scientific (NYSE:TMO) were among the weakest S&P 500 performers.

Stocks - Wall Street Slumps Again on U.S.-China Tensions
 

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Comments (10)
Robert Tew
Robert Tew Oct 09, 2019 12:21AM ET
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hello darkness my old friend …
eddie smith
eddie smith Oct 08, 2019 9:38PM ET
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in starting my career in financial journalism. basically i am going to attribute every slight move to trade war fears either getting better or worse and pump out articles with the same headlines day after day. i think i will do well.
Anthony Maestas
Anthony Maestas Oct 08, 2019 9:38PM ET
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Well, I'm not sure where you're from, but where I'm from 730 billion dollars isn't an insignificant amount of money. The seeds of fear that both governments have sown into the minds of investors is not without merit. By the same token, if you're naive enough to think that all the worlds economic woes are being played out on a single stage, then perhaps you should just stick with saving your money under your mattress as an investment strategy that you can feel more confident about.
eddie smith
eddie smith Oct 08, 2019 9:38PM ET
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Anthony Maestas it's just fear mongering and lazy journalism. the market is not acting any different that it has for decades.
Junk Man
Junk_Man Oct 08, 2019 7:55PM ET
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Trump can only play his 3 card Monte game for so long...
Hank Williams
Hank Williams Oct 08, 2019 7:23PM ET
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Market is doomed. Glad to be in mostly cash.
Jack Drummond
Jack Drummond Oct 08, 2019 6:49PM ET
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The market makers- they're just jerking you around. See, they say that they don't know any better. Trump is jacking the market up and down whenever one of his inside trader buddies takes a position. Tell me I'm wrong.
Aaron Last Name
Aaron Last Name Oct 08, 2019 6:02PM ET
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Same horse puckey day in day out. end of week everything is okay and we'll finish up on the Dow on news we found the mysterious unicorn in the China deal
Ravjir Urjinee
Ravjir Urjinee Oct 08, 2019 5:23PM ET
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End The Fed
Fred Broman
fatherofmothers Oct 08, 2019 5:05PM ET
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H i
JESUSLOVES YOU
JESUSLOVES YOU Oct 08, 2019 4:43PM ET
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hello
Scentro Blvck
Scentro Blvck Oct 08, 2019 4:43PM ET
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Ehsan Zohary
Ehsan Zohary Oct 08, 2019 4:31PM ET
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Scentro Blvck
Scentro Blvck Oct 08, 2019 4:31PM ET
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