Wall Street slides as US-China trade war escalates
U.S stocks slid on Wednesday amid a broad selloff on escalating trade war tensions after the United States threatened to impose tariffs on an additional $200 billion worth of Chinese goods.
Washington on Tuesday issued a list of thousands of Chinese imports that the Trump administration wants to target with new tariffs. In response, China accused the United States of bullying and warned it would hit back.
“Unfortunately the markets haven’t come to grips with the current levels of trade policies and tariffs,” said Art Hogan, chief market strategist at B. Riley FBR in New York
“Concerns over trade and trade wars are really having an adverse effect, less so on the U.S. markets than the international markets, but it is certainly taking a bite.”
Adding to tensions was the NATO summit in Brussels, where President Donald Trump accused Germany of being a “captive” of Russia. He also wants Europeans to pay more for their own defense.
At 10:04 a.m. EDT the Dow Jones Industrial Average was down 141.78 points, or 0.57 percent, at 24,777.88, the S&P 500 was down 11.70 points, or 0.42 percent, at 2,782.14 and the Nasdaq Composite was down 22.36 points, or 0.29 percent, at 7,736.84.
The biggest drags on the blue-chip Dow were Boeing, 3M, Caterpillar and United Technologies. Their shares were down between 1.2 percent and 2 percent.
Ten of the 11 major sectors were lower. The S&P industrials sector tumbled 1.22 percent, making it the biggest decliner and drag on the benchmark S&P.
The technology sector slid 0.21 percent. Chipmakers, which largely depend on China for their revenue, weighed the most, with the Philadelphia semiconductor index falling 1.43 percent.
The defensive utilities sector was the only one in the positive territory, with a 0.35 percent gain.
21st Century Fox fell 2.2 percent after the media company raised its offer for Britain’s Sky, seeing off rival bidder Comcast for now. Comcast rose 1.5 percent.
Fastenal’s shares rose 5.4 percent, the most on the S&P, after the industrial products distributor’s Q2 revenue and profit topped estimates.
The next biggest gainer was TripAdvisor, which rose 3.4 percent on a Barclays rating upgrade.
Declining issues outnumbered advancers for a 2.19-to-1 ratio on the NYSE and a 1.40-to-1 ratio on the Nasdaq.
The S&P index recorded eight new 52-week highs and one new low, while the Nasdaq recorded 27 new highs and 18 new lows.