U.S.-China trade dispute trips up stocks

NEW YORK — Automakers and technology and industrial companies fell Thursday as investors focused on the U.S.-China trade dispute, which could reduce company spending and earnings. The Dow Jones Industrial Average slipped for the eighth day in a row.

While investors generally don't expect a trade war between the U.S. and China, they remain sensitive to signs that rising tariffs and trade tensions will hurt the global economy and reduce corporate profits. This week they've received some signs that this is happening.

On Thursday German automaker Daimler said the tariffs China plans to put on cars imported from the U.S. will contribute to a small decline in earnings this year.

The previous day, Fed Chairman Jerome Powell said the U.S. central bank has heard about businesses holding off on hiring and spending in response to the trade conflicts.

Kate Moore, global equity strategist for BlackRock, said that investors have been hoping that the Republican-backed corporate tax cut would encourage companies to hire more workers, boost pay and expand their operations, but the uncertainty over tariffs is discouraging them from doing that.

“There's a fear that rising uncertainty around trade and tariffs is going to significantly affect investment decisions and hiring decisions, and potentially take some steam off of what has looked like a very strong expansion,” she said.

She added that companies have been reluctant to make major investments since the financial crisis of 2008-09, and some investors felt the tax cuts would help change that pattern.

Online retailers skidded and rivals such as department stores rose after the Supreme Court ruled that states can force more online shoppers to pay sales tax.

Energy companies declined ahead of a meeting where OPEC countries and other nations are expected to increase oil production.

Bond yields fell, and big dividend payers like real estate investment trusts and utilities made some of the biggest gains on Wall Street.

Online retailers dropped following the Supreme Court ruling. For more than two decades, companies were not required to collect sales tax on online purchases that were made in a state where the company did not have a warehouse, office or other physical presence. States argued that those rules deprived them of billions of dollars in tax revenue, and traditional retailers said online sellers had an unfair advantage.

Overstock.com lost 7.2 percent to $36.15, and home goods site Wayfair gave up 1.6 percent to $114.28, while Amazon lost 1.1 percent to $1,730.22.

Target gained 1 percent to $76.14 and Nordstrom added 1.8 percent to $52.78.