Sign of weakness in China weighs on stocks
Associated Press
NEW YORK — Stocks took small losses Monday after China reported a drop in exports in December, but the market didn’t come close to matching the plunges it took in the past few months.
Indexes in Europe and Asia headed slightly lower after the latest report added more evidence that China’s economy is weakening. Major U.S. indexes fell about 1 percent at the start of trading, but soon recovered much of what they’d lost. Technology companies slumped.
Drugmakers fell after Democrats in the House of Representatives announced an investigation into prescription drug pricing. A strong quarterly report from Citigroup helped bank stocks trade higher.
China’s exports slipped in December, and exports to the U.S. fell 3.5 percent as rising tariffs and broader weakness affected the world’s second-largest economy. Concerns about the Chinese economy and the overall global economy were a major contributor to the market’s plunge in late 2018.
Mark Esposito, president of Esposito Securities, said the calm reaction to the news from China suggests stocks won’t fall further than
they did in December.
“That’s a very positive sign that, at least in the short term, we may have found a bottom,” he said. “People lose faith and hope when [the market] drops 20 percent in a very short period like it did.”
The S&P 500 index dropped from late September until the day before Christmas, partly because investors were worried that the global economy was slowing dramatically and could fall into a recession. Since Dec. 26, stocks have regained about half of what they lost in the downturn.
On Monday, the S&P 500 fell 13.65 points, or 0.5 percent, to 2,582.61. The Dow Jones Industrial Average fell 230 points Monday morning, but finished with a loss of 86.11 points, or 0.4 percent, to 23,909.84.
The Nasdaq composite retreated 65.56 points, or 0.9 percent, to 6,905.92. The Russell 2000 index of smaller-company stocks shed 14.57 points, or 1 percent, to 1,432.81.
The stock market’s recent rally suggests investors aren’t quite as worried about the global economy or the state of trade talks. They still took a cautious approach to technology companies. Apple lost 1.5 percent to $150. The company’s shares tumbled last month after it said sales in China were falling. Chipmaker Texas Instruments lost 2.3 percent to $96.33.