Wall Street on Track to Snap Four-Day Rally; Latest Trade Threat Weighs[embedded content]
NEW YORK — U.S. stocks looked set on Wednesday to snap a four-day winning streak after Washington’s threat to impose tariffs on an additional $200 billion worth of Chinese goods fanned trade war fears, while a sharp drop in oil prices hit energy.
China responded to U.S. President Donald Trump’s threats by accusing the United States of bullying and warned that it would hit back.
Industrial names including Boeing, 3M and Caterpillar, which have been among the hardest hit throughout the recent trade dispute, were among the Dow’s biggest drags on Wednesday.
The materials index, down 1.7 percent, was another big negative influence among sectors, with Freeport-McMoRan down 3.7 percent as copper prices hit their lowest in about a year.
“The tone of today didn’t start off well due to tariff fears,” said Michael Antonelli, managing director, institutional sales trading, at Robert W. Baird in Milwaukee.
But, he said, “the drop in oil is driving this extra drop lower.”
The S&P 500 energy index fell 2.1 percent, leading sector declines. U.S. crude oil futures settled down 5 percent on the trade dispute escalation and as expectations of growing supplies increased on news that Libya would reopen ports.
The Dow Jones Industrial Average fell 186.39 points, or 0.75 percent, to 24,733.27, the S&P 500 lost 16.59 points, or 0.59 percent, to 2,777.25 and the Nasdaq Composite dropped 32.84 points, or 0.42 percent, to 7,726.35.
The drop is not as steep as what was seen in late March and early April when the escalating trade rhetoric between China and the United States led to the S&P falling more than 2 percent on four occasions.
The market slide has been contained by the speculation that the Trump administration could change its mind by the end