The S&P 500 and the Dow Jones Industrial Average slipped back into losses for the year on Thursday as U.S. stocks slid on mounting worries of slowing global growth after a fresh twist in China-U.S. tensions as well as falling oil prices and U.S. bond yields.
Just after 1 p.m. ET, the Dow was down 468 points, or 1.9 percent, at 24,559, the S&P 500 was down 44 points, or 1.6 percent, at 2,655 and the Nasdaq Composite was down 54 points, or 1 percent, at 7,105.
At its low of the day, the Dow Jones Industrial Average dropped nearly 800 points, bringing its two-day losses to more than 1,500 points. But the market bounced off its lows midway through the trading day as shares of Amazon and Alphabet fought back into the green.
Canada arrested Chinese smartphone maker Huawei Technologies Co Ltd’s chief financial officer for extradition to the United States, casting fresh doubts over the prospect of Beijing and Washington striking a deal on trade tariffs in their 90-day truce period.
“Disappointment in the China agreement and the arrest of Huawei CFO is on everybody’s mind today and it puts a damper in the trade talks,” said Larry Benedict, founder of Opportunistic Trader in Boca Raton, Florida.
Optimism after the trade truce over the weekend boosted Wall Street on Monday, extending a rally from last week when the Federal Reserve signaled the pace of rate increases could slow.
But that optimism faded on Tuesday and, along with a drop in longer-dated U.S Treasury yields, sent the S&P to its biggest single-day percentage drop in about two months.
The drop continued Thursday – the U.S. market was closed on Wednesday – as bond yields and oil prices both slid.
Benchmark 10-year Treasury yield held at three-month lows as traders