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Stocks: Fear of Stalled China Trade Deal Slams Stocks

Stock Markets Nov 20, 2019 04:57PM ET
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© Reuters.

Investing.com – Stocks fell back on Wednesday as multiple news reports suggested a U.S.-China trade deal won't get signed this year.

Reports that the talks were struggling or stalled altogether have been coming for the last few days and a Wall Street Journal report on the subject late Tuesday finally caused investors and computerized trading programs to react.

At the worst of the selling, the Dow Jones Industrial Average was down nearly 260 points, or 0.9%. But assurances from the White House and President Donald Trump that the U.S. and China were still talking cut the loss by more than half.

The Dow closed down 0.4%, or about 113 points. The S&P 500 fell 0.38%. The NASDAQ Composite dropped 0.51%, and the Nasdaq 100, dominated by big tech stocks, slumped 0.66%.

Apple (NASDAQ:AAPL) fell 1.16% and subtracted 11.8 points from the Nasdaq 100 index and 22 points from the Dow. Only Home Depot (NYSE:HD), down 2.2%, had a bigger negative impact on the Dow -- nearly 34 points.

Boeing (NYSE:BA) was the Dow leader, up 1.1%, adding 26 points to the blue-chip index. Only nine Dow stocks were higher on the day. The stock moved up on news it has signed a deal to sell 30 787 Dreamliners to Emirates, the Middle-East-based airline giant. The planes have a list value of $8.8 billion, although actual prices are usually lower.

At the same time, crude oil prices rallied as much as 3% after a weekly report showed U.S. oil inventories rising by a smaller amount than expected. The effect was to boost energy shares like Chevron (NYSE:CVX) and Exxon Mobil (NYSE:XOM) and slam airline stocks. American Airlines Group (NASDAQ:AAL) was the biggest percentage loser among Nasdaq 100 stocks.

The Dow suffered its second 100-point loss in two days, the first time that's happened since early October.

Interest rates moved lower on the selling. The United States 10-Year Treasury yield fell to 1.736% from 1.41% on Tuesday. Gold , however, was little changed.

The market has set record closing and intraday highs multiple times in the last week and into Monday, largely on the hopes a Phase 1 trade deal between the U.S. and China was about to happen. In the process, the major indexes and key stocks like Apple probably rose too fast and became vulnerable to selling if there was any bad news.

Retailer Target (NYSE:TGT), thanks to a strong fiscal-third quarter report and improved guidance, was the top S&P 500 on the day, followed by oil-service giant Schlumberger (NYSE:SLB), medical technology Hologic (NASDAQ:HOLX) and home-improvement retailer Lowe’s Companies (NYSE:LOW). Lowe's reported strong earnings before Wednesday's open.

Despite Target and Lowe's, retailers were among the weakest sectors on the day. L Brands (NYSE:LB), Nordstrom (NYSE:JWN), Capri Holdings (NYSE:CPRI) (best known for its Michael Kors brands) and motorcycle maker Harley-Davidson (NYSE:HOG) were among the weakest S&P 500 performers.

Stocks: Fear of Stalled China Trade Deal Slams Stocks
 

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Comments (11)
eddie glass
eddie glass Nov 20, 2019 10:34PM ET
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the democrats have put their nail in the own coffin for 2020 with this nonsense
Adamo Nals
Adamo Nals Nov 20, 2019 7:18PM ET
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This is not even close to slam stocks. When we sell off 100 points in the S&P in a day that will be a good start. This is a joke, the market right now. It is grossly grossly grossly overpriced with zero of the legitimate emergency headwinds Priced in
Ron Warren
Ron Warren Nov 20, 2019 7:06PM ET
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we haven't had a sell-off for months now.
Bubba Born
Bubba Born Nov 20, 2019 6:58PM ET
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Bet you wish you had a Democrat for a President now! Only companies showing signs of increased earnings are those that manufacture antacids for your stomach!
Dary Alvarez
Dary Alvarez Nov 20, 2019 6:36PM ET
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today was the 10 year bond report but I have a question. Why was that report today and how can I know what day will happen again?. I mean, what day will the 10-year bonus report be again?
Ryan Grandinetti
Ryan Grandinetti Nov 20, 2019 6:36PM ET
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check the calender on your investors app
wahid archer
wahid archer Nov 20, 2019 5:45PM ET
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thx...
Tony SK Lai
Tony SK Lai Nov 20, 2019 5:30PM ET
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China exhausted dollar how to trade?!
David David
David9 Nov 20, 2019 4:50PM ET
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China sees there is a chance he will get impeached so now China is going to wait a little.
Ryan Grandinetti
Ryan Grandinetti Nov 20, 2019 4:50PM ET
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impeached for what Wong
Ryan Grandinetti
Ryan Grandinetti Nov 20, 2019 4:50PM ET
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no chance Xi Wong lolol
drew allen
drew allen Nov 20, 2019 4:50PM ET
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impeached cause someone's feelings got hurt, and someone's third cousin heard something from an ex's fifth brother who said something to a dog who's dog said jimmy was in a well and can't get out cause there's no quid pro quo down there. this impeachment is a joke that even the dems hate and nation ratings hate only the speaker aoc and adam shift like it.
Habanero Peppers
Habanero Peppers Nov 20, 2019 4:50PM ET
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drew allen Trump wants to be impeached. Got his perks, now back to business...
Green Greta
GreenGreta Nov 20, 2019 4:29PM ET
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So, in other words. Trade deal delayed, all is good, please don't sell off the markets everyone!!! It'll happen, keep them high until re election time!
Ben Shilock
Ben Shilock Nov 20, 2019 4:29PM ET
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If he is re elected, it could fall much more
TA XVCI
TA XVCI Nov 20, 2019 4:29PM ET
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Its overpriced, so sell off.
Yellow Peter
Yellow Peter Nov 20, 2019 4:27PM ET
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Slam??? LOL
Jonathan Snell
Jonathan Snell Nov 20, 2019 4:27PM ET
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exactly!
 
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