Investors rode out another turbulent day on Wall Street that kept stock indexes flipping between gains and losses until a late-day bounce gave the market a modest gain.
Worries about a possible recession collided with hopes that the strongest part of the US economy – shoppers spending at stores and online – can keep going.
The major US stock indexes spent much of the day reacting to big moves in US government bond yields, which fell sharply in the early going, fluctuated for much of the day, and then recovered some of their decline by mid-afternoon.
US government bonds have been among the loudest and earliest to cry out warnings about the economy. Stocks fell sharply on Wednesday after a fairly reliable warning signal of recession emerged from the bond market. Even after the slide in yields eased on Thursday, the US bond market continued to show concern as yields ended broadly lower.
Stocks around the world remained stuck in the spin cycle, amid worries about a possible recession.
Stocks in Asia and Europe paved the way for the turbulent day on Wall Street early on Thursday after China said it would take “necessary countermeasures” if US President Donald Trump follows through on a threat to impose tariffs on more than US$100 billion (NZ$155 billion) of Chinese goods on September 1.
“What you’re seeing really is what’s been driving the market the last couple of weeks: Trade tensions as well as yield curve stress,” said Lindsey Bell, investment strategist at CFRA.
The S&P 500 rose 7 points, or 0.2 per cent, to 2847.60. The benchmark index