U.S. stocks closed mostly lower Thursday after a dramatic session that saw the Dow Jones Industrial Average plunge more than 700 points at one point on fears that the arrest of a Huawei executive would reignite trade worries.
However, the market clawed back most of its losses on a report that the Federal Reserve may turn more accommodative.
How did the benchmarks fare?
The Dow Jones Industrial Average DJIA, -0.32% declined 79.40 points, or 0.3%, to 24,947.67, though the index was down by as much as 785 points at the lowest point. The S&P 500 index SPX, -0.15% dropped 4.11 points, 0.2%, to 2,696.95 and the Nasdaq Composite Index COMP, +0.42% fell 29.83 points, or 0.4%, to 7,188.26.
The afternoon rebound put the Dow and the S&P back into the positive for 2018, while the Nasdaq built on its gains to rise 4.1% for the year.
What drove the market?
Investors were rattled by news that Canadian authorities had arrested Meng Wanzhou, the chief financial officer of Huawei Technologies, at the request of U.S. authorities for allegedly violating sanctions against Iran. The arrest, which was made on Dec. 1, comes as the U.S. has taken several steps to restrict the Chinese technology giant, and has tried to persuade international allies to do the same.
In a sign of how unsettled investors were, stock-index futures dropped so precipitously Thursday that the Chicago Mercantile Exchange triggered circuit breakers to avoid worse losses. Those futures spiked down to 2,659, a drop of 1.9% before the CME stopped trading briefly to try to calm the market, said Chris Weston, head of research at Pepperstone.
FactSet S&P 500 futures tumble sharply at Thursday’s reopen
The latest development comes amid an already shaky backdrop for trade relations between the U.S. and China. Doubts surrounding the