By Geoffrey Smith
Investing.com -- U.S. stock markets opened mostly lower on Monday amid concerns over slower growth in China and faster viral spread in the U.S.
Data released overnight showed the Chinese economy slowed markedly in July, against a backdrop of characteristically aggressive efforts to stamp out local outbreaks of Covid-19 in China. The measures are yet to succeed in full, and one of the terminals at Nangbo-Zhonshuan, the world's third-largest container port, remains shut on Monday after being closed last week.
China's industrial production and retail sales growth both came in below expectations for July, with output growing at its slowest rate since September last year and sales growth at a six-month low. The data also revealed a clear drop in Chinese fuel demand in response to the latest wave of lockdown measures, something that pushed crude oil prices more than 1% lower earlier on Monday.
The U.S., meanwhile, registered its worst week for new cases of Covid-19 since February last week, with the average daily case load rising to over 124,000. The latest wave of cases helped trigger a sharp drop in U.S. consumer confidence, according to data released Friday, casting doubt on the achievability of herd immunity. Fears of a slowing economy pushed the 10-year Treasury bond yield down to 1.25% despite a Wall Street Journal report suggesting that the Federal Reserve is preparing a more rapid end to its asset purchases than many have expected. The WSJ suggested that the Fed would look to start tapering bond purchases in September and finish by June next year.
By 10:20 AM ET (1420 GMT), the Dow Jones Industrial Average was down 164 points, or 0.5%, at 35,352 points, having closed last week at a record high. The S&P 500 was down 0.6% and the Nasdaq Composite were down 1.2%.
Tesla (NASDAQ:TSLA) stock grabbed headlines for the wrong reasons in early trading, falling over 4% after the National Highway Traffic Safety Administration said it had started an investigation into the company's Autopilot software and its role in nearly 20 crashes since 2018, many of them involving emergency vehicles. It's the most serious action taken in years by the NHTSA against Tesla, and comes after criticism even from the National Transportation Safety Board of its relaxed approach to policing the company.
It was a rough morning for vaccine makers, which continued to give back some of the lavish gains they had made in previous weeks.BioNTech SE (NASDAQ:BNTX) stock fell 14.7%, while Moderna (NASDAQ:MRNA) stock fell 9.9% and Novavax (NASDAQ:NVAX) stock rose 9.6%. The stocks had all reached record highs on speculation that much of the rich world will endorse 'booster shots' against Covid-19.
Sonos (NASDAQ:SONO) stock bucked the broader trend, rising 7% to a four-month high after an important patent lawsuit victory over Google (NASDAQ:GOOGL) on Friday, which was announced after the market close.
Oatly ADRs (NASDAQ:OTLY) was another rare name in the green, rising 4.2% after the vegan milk maker raised its revenue forecast for the full year. Its net loss was wider than expected however, and the rise comes after the stock touched an all-time low last week.