Dow Jones Industrial Average Fell as China Is in a Bad Mood Ahead of Trade Talks – Barron's

Illustration by Michael George Haddad

The Red Sea. All three U.S. stock indexes closed solidly in the red on Tuesday as investors worried about uncertainties around high-level trade talks with China set to start on Thursday. The U.S. added more Chinese tech companies to its trade blacklist, while the National Basketball Association faces some censorship challenges from China as well. Fed Chairman Jerome Powell said the central bank plans to purchase more Treasuries to boost reserves, but didn’t say if a third rate cut is in the planning. In today’s After the Bell, we…

look into the complicated details of the U.S.-China trade talks; explain why a temporary truce could be key to the market now; and check on what the Fed plans to do.

Trade Worries Deepen

Stocks fell for a second day, and all three indexes closed with deep losses. The Dow Jones Industrial Average tumbled 313.98 points, or 1.19%, to close at 26,164.04. The S&P 500 fell 45.73 points, or 1.56%, to finish at 2893.06, and the Nasdaq Composite lost 132.52 points, or 1.67%, to close at 7823.78.

Investors are getting nervous ahead of talks between the U.S. and China while many uncertainties still loom. The negotiations have become more complicated now that there are new sources of contention between the countries.

Editor’s Choice

The Commerce Department expanded its trade blacklist to include eight Chinese tech firms—citing alleged human rights abuses and high-tech surveillance against the country’s Muslim minority—and barred the purchase of parts and components from these firms without government approval.

There have also been reports—denied by the Treasury Department—that the Trump

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