Wall Street declined on Wednesday, snapping a four-session winning streak, after Washington announced tariffs on an additional $200 billion worth of Chinese goods, fanning trade war fears, while a sharp drop in oil prices hit energy shares.
The Dow Jones Industrial Average declined 219 points, or 0.88%, to 24,700, the S&P 500 lost 20 points, or 0.71%, to 2,774 and the Nasdaq Composite dropped 43 points, or 0.55%, to 7,717.
China’s Ministry of Commerce said in a statement that the new levies are “totally unacceptable” and that the behaviour is hurting not just China but the whole world.
Industrial names including Boeing, 3M and Caterpillar, which have been among the hardest hit by the recent trade dispute, were among the Dow’s biggest drags.
Materials sector was another big negative influence on the market, with Freeport-McMoRan down 3.9% as copper prices hit their lowest in about a year.
Energy companies fell after US crude oil futures settled down 5% on the trade dispute escalation and as expectations of growing supplies increased on news that Libya would reopen ports. Chevron lost 3.2%. Halliburton Co. was down 2.5%.
Chipmakers, which largely depend on China for their revenue, declined. Shares of Nvidia Corp. dropped 2.3%.
Investors were hopeful that trade war worries will give way to second-quarter earnings over the coming weeks. Results from JP Morgan Chase and other big banks are due on Friday.
The utilities sector was the only one in positive territory, with a 0.9%.
Twenty-First Century Fox fell 4% after the media company raised its offer for Britain’s Sky, seeing off rival bidder Comcast for now. Comcast shares were up 1.3%.
In Asia, shares traded mostly higher on Thursday in morning session, with markets shaking off some of the trade jitters seen overnight.
The Nikkei 225 rose 0.77% in Tokyo. In Seoul, the Kospi was little changed, trading lower by 0.02%. Meanwhile, the S&P/ASX 200 tacked on 0.31% in Sydney.
In China, the Shanghai Composite Index added 1.11%, while Hong Kong’s Hang Seng Index rose 0.23%.