Wall Street's main indexes tumbled more than 1 percent on Tuesday, as renewed worries over trade negotiations with China stoked global growth worries and kept investors away from risky assets. Beijing said on Tuesday that Chinese Vice Premier Liu He will visit the United States this week for trade talks, playing down US President Donald Trump's unexpected threat on Sunday that he would raise tariffs on $200 billion worth of Chinese goods to 25 percent from 10 percent.
Trade tensions also pushed US treasury yields lower as investors turned to low-risk government bonds, pressuring interest rate sensitive banking stocks, which fell 1.69%. "Many had been looking at this week as providing a potential breakthrough in talks between the world's two largest economies, yet we instead have seen the US threaten a raft of new tariffs," Joshua Mahony, senior market analyst at IG, wrote in a note.
Boeing Co, the single largest US exporter to China, slipped 2.7% and Caterpillar Inc declined 1.9%. All the major S&P sectors were trading in the red, with technology companies posting the steepest decline of 2%. The CBOE Volatility Index, a gauge of investor anxiety, spiked to its higher level in over three months.
At 10:55 a.m. ET the Dow Jones Industrial Average was down 355.41 points, or 1.34%, at 26,083.07. The S&P 500 was down 42.23 points, or 1.44%, at 2,890.24 and the Nasdaq Composite was down 138.67 points, or 1.71%, at 7,984.62. Marquee names including Microsoft Corp, Apple Inc, Amazon.com Inc and Facebook Inc fell more than 1.7% and weighed on markets.
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