Published: Sat, March 24, 2018
Money | By Armando Alvarado

Stocks tumble as investors fear escalating USA and China trade conflict

Stocks tumble as investors fear escalating USA and China trade conflict

The S&P 500 notched its worst week in more than two years Friday, as stocks continued to retreat while investors weigh the impact of tariffs and higher interest rates.

The Dow plunged 724.42 points or 2.9% to 23,957.89, the Nasdaq tumbled 178.61 points or 2.4% to 7,166.68 points or 2.4% to 7,166.68 and the S&P 500 plummeted 68.24 points or 2.5% to 2,643.69.

The Dow Jones industrial average lost 424.69 points, or 1.8%, to 23,533.20. At the epicenter this time is US President Donald Trump, with his China tariffs driving Boeing Co. down more than 5 per cent in a single session on Thursday and losses rippling across industries from technology to banks. The Nasdaq Composite Index was down 38.85 points, or 0.54 per cent, to 7,127.82.

Investors were also concerned about the pace of future growth as the Fed on Wednesday raised its benchmark federal-funds rate by a quarter percentage point, to a range between 1.5 per cent and 1.75 per cent, and signaled a quicker pace of future rate hikes.

Not every company set out how much of its revenue comes from overseas, but FactSet estimates that 30.5% of revenue at big companies in the S&P 500 comes from outside the United States.

Selling intensified into the close with the Dow losing more than 250 points in the final hour of trading.

Micron Technology sank 6.3 percent and Bank of America lost 2.6 percent.

China said Thursday it would impose tariffs on up to 128 products imported from the United States, with most of the pain expected to land on American agriculture, including fruit and wine. Trump himself has tweeted, saying trade wars are "good", and "easy to win". Online retailer Amazon slid $36.94, or 2.3 percent, to $1,544.92.

Mozilla Hits Pause On Facebook Ads, Cites User Data Policies
Lastly, Facebook is expanding its bug bounty program, rewarding more people for reporting any misuses of data by app developers. Many users on Facebook have seen ads that are marketed directly to them depending on their posts , interests and other factors.

Stocks are turning lower on Wall Street following a huge slump a day earlier, when worries about an escalating trade conflict between the US and China rattled investors. The S&P technology index fell 2.69 per cent on fears of greater regulation in the wake of the Facebook data leak. The benchmark index also nudged closer to its February low, which marked a correction, ending 9.9 percent lower than its January 26 record. China has threatened to fight back, saying it will pursue tariffs on $3 billion in US products such as steel, pork and wine.

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Thursday.

In Europe, markets trimmed losses sharply in afternoon trade.

"If the Trump administration really wanted to hurt China and start a trade war, then they would go after those larger sectors", he said. Wall Street is anxious that the President's protectionist trade policy could face retaliation from major trading partners, and ignite a trade war contribute that could bring inflation to the economy.

"Now we've crossed a red line. and mix into that narrative the fact that you have the legal team for Trump moving around a little bit", Hogan said.

The report said initial jobless claims edged up to 229,000, an increase of 3,000 from the previous week's unrevised level of 226,000.

Investors are also concerned that the Federal Reserve may hike interest rates faster than expected if USA economic growth continues to firm.

Prices for Treasury bonds and gold rose.

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