Stocks Tumble on Trade War Anxiety 05/23 09:57
Stocks tumbled Thursday on Wall Street as investors' anxiety over the U.S.
trade spat with China increased and put the market on track for its third
straight week of losses.
NEW YORK (AP) -- Stocks tumbled Thursday on Wall Street as investors'
anxiety over the U.S. trade spat with China increased and put the market on
track for its third straight week of losses.
The Dow Jones Industrial Average fell as much as 400 points. Every sector in
the S&P 500 index fell except for utilities. Investors sought safety in the
bond market and the yield on the 10-year Treasury dropped to 2.33 percent, the
lowest level in more than a year.
The market has been highly volatile this month as the U.S. and China
escalate their dispute over trade. The two sides have broken off negotiations
and appear set for long standoff. Investors are concerned a prolonged trade war
could hurt the U.S. economy and corporate profits. The broad S&P 500 index is
on pace for its worst month of 2019.
Trade-sensitive technology stocks again led the losses. Many tech companies
do significant business with China and this week face the additional headwind
of proposed restrictions on technology sales to Chinese companies by the Trump
administration. Apple fell 2.1% and Microsoft fell 1.2%. Chipmakers, including
Intel, Broadcom and Nvidia, all fell broadly.
Banks also fell broadly in the sell-off. JPMorgan shed 2.1% and Bank of
America slid 2.5%.
Energy stocks slid as the price of oil plunged 4.8% to $58.50 a barrel.
Investors fled to safer holdings. Utilities were the only companies making
gains. The sector is considered less of an investment risk and more money gets
shifted into those stocks when people are concerned about volatility and a
slowdown in economic growth.
The U.S. and China concluded their 11th round of trade talks earlier this
month with no agreement. Instead, the U.S. moved to increase tariffs on Chinese
goods, prompting China to do the same. The trade dispute escalated further
after the U.S. proposed restrictions on technology sales to China, though it
has temporarily backed off.
China is looking for ways to retaliate and has reached out for support from
Russia and its neighbors in Asia. Both the U.S. and China have made overtures
about continuing trade talks, but none are scheduled.
Markets in Asia and Europe also saw steep losses.
KEEPING SCORE: The S&P 500 index fell 1.4% as of 10:20 a.m. The Dow Jones
Industrial Average fell 370 points, or 1.4%, to 25,408. The Nasdaq composite
BRAZIL CALLING: Avon shares soared 9.3% after Brazilian cosmetics maker
Natura announced that it is buying the beauty products company for $3.7 billion
The deal would create the world's fourth-largest group of beauty products.
Natura also currently owns retail stores like The Body Shop.
ENTICING PROFIT: Victoria's Secret owner L Brands surged 13.8% after blowing
away Wall Street's first quarter earnings forecasts.
The company, which also owns Bath & Body Works, gave investors a surprise
profit on better-than-expected revenue.
Copyright 2019 DTN/The Progressive Farmer. All rights reserved.