Dow stages comeback from deep losses fueled by uncertainty on US-China trade deal

American flags fly outside of the New York Stock Exchange. Michael Nagle for Bloomberg U.S. stock markets on Thursday spent most of the day deep in the red in an across-the-board rout triggered by the prospect that a U.S.-China trade deal was in jeopardy.

Investor angst was fueled by the arrest of a Chinese executive that further threatened progress on trade, coupled with omens of a recession in the bond market and a steep drop in oil prices.

It was a nerve-racking ride down: 500 stocks had hit new 52-week lows by 11:30 a.m.

At its low, the Dow Jones industrial average fell 784 points, or 3.1 percent. By the final hour of trading, it had clawed its way back and closed the day down 79 points, or 0.3 percent, at 24,947.67.

In a tremendous late-day rally, the tech-heavy Nasdaq composite index pulled into positive territory, ending up 0.4 percent. And the Standard & Poor’s 500-stock index came back to finish down just 0.2 percent.

Investors seemed heartened by comments from JPMorgan Chase CEO Jamie Dimon and Christine Lagarde, managing director of the International Monetary Fund.

“On the actual effects on the ground, you still have a strong economy,” Dimon said in an interview with CNBC. He stressed repeatedly that the economic fundamentals still look good.

“If you speak to most of the CEOs, they say: Their order books are good, consumer balance sheets are good, the economy is growing, wages are going up, they’re still hiring people, unemployment may very well hit 3.3 percent this year,” he said. “That’s all good.”

Lagarde said global slowdown fears are overblown. “It’s a little bit overdone – 3.7 percent forecasts for [global] growth is not bad,” Lagarde said, also on CNBC.

Markets also were buoyed by news reports that the

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