Trade war fears send stocks lower
U.S. stock indexes closed slightly lower Thursday after a day of mostly choppy trading, wiping out some of the market’s gains from a day earlier.
Technology stocks took some of the worst losses. Fast-food chains and other consumer-focused companies, utilities and banks also declined, outweighing gains in energy and industrial stocks. Small-company stocks fared better than the rest of the market.
The indexes veered solidly into the red by late afternoon ahead of a new round of trade talks between the U.S. and China. The countries have threatened tariffs on each other.
“Now that we’re making it out of earnings season, geopolitical is going to come back into the forefront of what the market’s concerns are,” said Shawn Cruz, manager of trader strategy at TD Ameritrade. “And that may continue to drive intraday volatility until we get more certainty as far as what is actually going to come out of these trade talks.”
The S&P 500 index slipped 2.33 points, or 0.1%, to 2,720.13. The Dow Jones industrial average lost 54.95 points, or 0.2%, to 24,713.98. The drop pulled the Dow into the red for the year. The Nasdaq composite fell 15.82 points, or 0.2%, to 7,382.47.
The Russell 2000 index of smaller-company stocks bucked the downward trend, setting an all-time high for the second day in a row. The index picked up 8.92 points, or 0.6%, to 1,625.29.
The Trump administration was scheduled to resume talks in Washington with senior Chinese officials seeking to ward off a trade war between the world’s two biggest economies. But while fielding questions from reporters Thursday, Trump suggested the talks may not end up averting a trade war with China: “Will that be successful? I tend to doubt it,” Trump said.
Investors took note of the remarks, and the market indexes moved lower after spending much of the day wavering between small gains and losses.
The latest quarterly results and outlooks from several companies also put investors in a selling mood.
J.C. Penney sank 12.4% to $2.69 after the struggling department store chain said it might take a loss in 2018 as it cut its annual forecast.
Cisco Systems led a slide in technology stocks after its latest quarterly results disappointed traders. The stock slid 3.8% to $43.46.
Dillard’s earnings exceeded Wall Street’s estimates. The department store chain climbed 6.3% to $76.53.
Benchmark U.S. crude oil ended f lat at $71.49 a barrel in New York. Brent crude rose 2 cents to $79.30 a barrel in London.
Energy stocks notched solid gains. Valero Energy gained 4.1% to $119.71.
Bond prices fell. The yield on the 10-year Treasury rose to 3.11% from 3.10% late Wednesday.
The dollar rose to 110.75 yen from 110.25 yen Wednesday. The euro weakened to $1.1799 from $1.1802.
Gold fell $2.10 to $1,289.40 an ounce. Silver added 11 cents to $16.48 an ounce. Copper gained 2 cents to $3.09 a pound.
Heating oil rose a penny to $2.28 a gallon. Wholesale gasoline fell a penny to $2.24 a gallon. Natural gas gained 4 cents to $2.89 per 1,000 cubic feet.