Tag Archives: Wall Street

S&P 500 hits all-time high on trade optimism

FILE PHOTO: Traders work on the main trading floor after the opening bell at New York Stock Exchange (NYSE) in New York, U.S. June 20, 2019. REUTERS/Brendan McDermid/File Photo

By Amy Caren Daniel and Shreyashi Sanyal

(Reuters) – The S&P 500 touched a record high for the second straight session on Friday as hopes of trade talks between Washington and Beijing were lifted by U.S. Vice President Mike Pence’s decision to defer a planned speech on China policy.

The decision was taken amid “positive signs” that trade talks with China could be back on track, the Wall Street Journal reported, citing a senior administration official.

The benchmark S&P 500 index hit an intraday high of 2,964.15 on Friday, but retreated into a tight range as rising tensions between the United States and Iran kept investors on edge.

The United States and China have said they would restart their trade talks after a lull at the Group of 20 summit in Japan next week.

“Investors are cautiously optimistic about the G20 summit. If they make progress then markets will celebrate that,” said Michael Antonelli, market strategist at Robert W. Baird in Milwaukee.

Stocks are now set to log their third straight week of gains, after posting their worst monthly performance this year in May on fears the prolonged trade war would hit global economic growth.

U.S. President Donald Trump said on Friday he aborted a military strike on Iran in response to Teheran downing a U.S. drone, but the possibility of a U.S. retaliation pushed crude prices higher and helped lift the energy sector by 0.49%. [O/R]

Traders also pointed to higher volatility during Friday’s session on account of “quadruple witching,” as investors unwind interests in futures and options contracts prior to expiration.

At 13:09 p.m. ET, the Dow Jones Industrial Average was up 45.72 points, or 0.17%, at 26,798.89 and the S&P 500 was down 0.53 points, or 0.02%, at 2,953.65.

The Nasdaq Composite was down 7.13 points, or 0.09%, at 8,044.21.

The tech-heavy index was weighed down by a 2.02% fall in PayPal Holdings Inc after the digital payments company said its chief operating officer Bill Ready would step down.

CarMax Inc rose as much as 6% to a record high after the used-vehicles retailer posted quarterly results above analysts’ expectations.

Carnival Corp fell for the second day, down 4.53%, and among the biggest decliners. Several brokerages trimmed their price targets after the cruise operator cut its 2019 profit forecast.

Declining issues outnumbered advancers for a 1.47-to-1 ratio on the NYSE and for a 1.71-to-1 ratio on the Nasdaq.

The S&P index recorded 33 new 52-week highs and two new lows, while the Nasdaq recorded 42 new highs and 49 new lows.

(Reporting by Amy Caren Daniel and Shreyashi Sanyal in Bengaluru; Editing by Sriraj Kalluvila)

Fed rate-cut signal sends stocks surging, wounds yields, dollar

FILE PHOTO: Traders work on the floor at the New York Stock Exchange (NYSE) in New York, U.S., June 19, 2019. REUTERS/Brendan McDermid/File Photo

By Lewis Krauskopf

NEW YORK (Reuters) – World stock markets surged on Thursday, with the U.S. benchmark S&P 500 hitting a record high, while the 10-year U.S. Treasury yield fell below 2% as investors digested a signal from the Federal Reserve of potential U.S. interest rate cuts as soon as its next meeting.

The U.S. dollar also weakened after the Fed – the U.S. central bank – on Wednesday indicated a marked shift in sentiment even as it left its benchmark rate unchanged for now.

“We have obviously morphed into the Fed taking the pole position as far what’s driving the market right now, both domestically and on a global basis as well,” said Mike Mullaney, director of global markets research at Boston Partners.

“It’s risk-on trade again right now for the time being and I don’t see anything on a near-term basis that is going to disrupt that.”

Oil prices also surged, lifted by the Fed as well as by news that Iran shot down a U.S. military drone, raising fears of a military confrontation between Tehran and Washington.

MSCI’s gauge of stocks across the globe gained 1.02%. The index hit its highest since May 1.

On Wall Street, the Dow Jones Industrial Average rose 203.87 points, or 0.77%, to 26,707.87, the S&P 500 gained 21.98 points, or 0.75%, to 2,948.44 and the Nasdaq Composite added 65.04 points, or 0.81%, to 8,052.36.

Energy, technology and industrials were among the best-performing S&P 500 sectors.

“Cyclicals are definitely getting a big pop today,” Mullaney said.

The pan-European STOXX 600 index rose 0.52%, reaching its highest since early May.

Benchmark government bond yields in the United States and Europe tumbled following the Fed’s decision, with the U.S. 10-year note yield falling below 2% for the first time in 2-1/2 years.

Benchmark 10-year U.S. notes last rose 12/32 in price to yield 1.9855%, from 2.027% late on Wednesday.

“The statement indicated the Fed no longer insists on a pause or patience, providing an open ear to doves at upcoming meetings. Also critical … acknowledgment that inflation pressures are muted,” said Jim Vogel, interest rate strategist at FTN Financial in Memphis, Tennessee.

“As difficult as it might be to imagine, rates are also free to fall further,” he added.

The dollar index, which measures the greenback against a basket of currencies, fell 0.46%, with the euro up 0.6% to $1.1291.

U.S. crude rose 5.73% to $56.84 per barrel and Brent was last at $64.51, up 4.35%.

 

(Additional reporting by Gertrude Chavez-Dreyfuss in New York and Tom Wilson in London; editing by Larry King and James Dalgleish)

Wall St. takes a breather with all eyes on Fed meeting

By Shreyashi Sanyal

(Reuters) – Wall Street’s main indexes took a pause on Wednesday, after a rally the previous day, as investors held back from making big bets ahead of the Federal Reserve’s policy statement that is expected to lay the groundwork for future interest rate cuts.

Markets have climbed this month, with the S&P 500 index gaining 6% so far and 1% away from its all-time high hit in early May, fueled by hopes of a rate cut.

The Fed’s statement and new economic projections are scheduled to be released at 2 p.m. ET (1800 GMT), providing investors an opportunity to gauge the impact of a prolonged U.S.-China trade conflict, President Donald Trump’s demands for a rate cut and softer-than-expected economic data on monetary policy thinking.

The U.S. central bank will likely leave rates unchanged but the market is factoring in a cut as soon as next month. Fed Chairman Jerome Powell will hold a press conference at 2:30 p.m. ET (1830 GMT).

“I think the potential for the Fed to disappoint today is significantly higher than the market expects,” said Yousef Abbasi, global market strategist at INTL FCStone Financial Inc in New York.

“The Fed has already told us that it’s ready to act but with the metrics we’ve seen in the economy – yes, they’re mixed, but they’re still growing – it just becomes very difficult for someone to say we absolutely need a rate cut.”

U.S. Treasury yields rose on Wednesday, tracking the European market, after steep falls the previous day, as investors rebalanced positions ahead of the Fed decision.

The financial sector gained 0.40%, with bank stocks rising by 0.15%.

At 11:18 a.m. ET, the Dow Jones Industrial Average was up 39.27 points, or 0.15%, at 26,504.81 and the S&P 500 was down 0.23 points, or 0.01%, at 2,917.52.

The Nasdaq Composite was down 3.74 points, or 0.05%, at 7,950.15.

The healthcare sector rose 0.44%, the most among the 11 major S&P sectors, helped by gains in UnitedHealth Group Inc, Pfizer Inc and Allergan Plc.

Allergan climbed 4.03% after the drugmaker said its constipation drug, jointly developed with Ironwood Pharmaceuticals Inc, improved symptoms of bloating, pain and discomfort in patients suffering from irritable bowel syndrome with constipation.

Adobe Inc jumped 4.43% after the Photoshop software provider beat analysts’ estimates for quarterly profit and revenue.

Advancing issues outnumbered decliners by a 1.10-to-1 ratio on the NYSE and by a 1.30-to-1 ratio on the Nasdaq.

The S&P index recorded 15 new 52-week highs and one new low, while the Nasdaq recorded 35 new highs and 43 new lows.

(Reporting by Shreyashi Sanyal and Aparajita Saxena in Bengaluru; Editing by Sriraj Kalluvila)

Wall Street plunges on heightening U.S.-China trade worries

By Amy Caren Daniel

(Reuters) – Wall Street’s main indexes tumbled more than 1 percent on Tuesday, as renewed worries over trade negotiations with China stoked global growth worries and kept investors away from risky assets.

Beijing said on Tuesday that Chinese Vice Premier Liu He will visit the United States this week for trade talks, playing down U.S. President Donald Trump’s unexpected threat on Sunday that he would raise tariffs on $200 billion worth of Chinese goods to 25 percent from 10 percent.

Trade tensions also pushed U.S. treasury yields lower as investors turned to low-risk government bonds, pressuring interest rate sensitive banking stocks, which fell 1.69%. [US/]

“Many had been looking at this week as providing a potential breakthrough in talks between the world’s two largest economies, yet we instead have seen the U.S. threaten a raft of new tariffs,” Joshua Mahony, senior market analyst at IG, wrote in a note.

“Much of the gains of the eventual deal have been factored into market valuations and thus there is a substantial risk that markets could jolt lower if the direction of talks shift towards more, rather than less barriers to trade.”

Boeing Co, the single largest U.S. exporter to China, slipped 2.7% and Caterpillar Inc declined 1.9%.

All the major S&P sectors were trading in the red, with technology companies posting the steepest decline of 2%.

The CBOE Volatility Index, a gauge of investor anxiety, spiked to its higher level in over three months.

At 10:55 a.m. ET the Dow Jones Industrial Average was down 355.41 points, or 1.34%, at 26,083.07. The S&P 500 was down 42.23 points, or 1.44%, at 2,890.24 and the Nasdaq Composite was down 138.67 points, or 1.71%, at 7,984.62.

Marquee names including Microsoft Corp, Apple Inc, Amazon.com Inc and Facebook Inc fell more than 1.7% and weighed on markets.

The earnings season has now reached its homestretch. Of the 414 S&P companies that have reported earnings so far, about 75% have surpassed analysts’ estimates, according to Refinitiv data.

The upbeat reports have turned around earnings estimates for the first quarter to an almost 1.2% rise, a sharp improvement from the 2.3% decline expected at the start of the earnings season.

American International Group Inc jumped 6.7%, the most among S&P companies, after the insurer reported a quarterly profit that blew past expectations.

Among decliners, Mylan NV tumbled 17% after the drugmaker missed Wall Street estimates for quarterly revenue, hurt partly by manufacturing problems at its Morgantown plant in West Virginia.

Shares of Regeneron Pharmaceuticals Inc fell 5% after the drugmaker missed quarterly profit estimates.

Declining issues outnumbered advancers for a 4.26-to-1 ratio on the NYSE and for a 2.95-to-1 ratio on the Nasdaq.

The S&P index recorded four new 52-week highs and four new lows, while the Nasdaq recorded 37 new highs and 22 new lows.

(Reporting by Amy Caren Daniel and Shreyashi Sanyal in Bengaluru; Editing by Shounak Dasgupta and Arun Koyyur)

Facebook shares drop as executives quit, Christchurch live-stream shooting stirs outrage

FILE PHOTO: Silhouettes of laptop users are seen next to a screen projection of Facebook logo in this picture illustration taken March 28, 2018. REUTERS/Dado Ruvic/Illustration/File Photo

(Reuters) – Shares of Facebook Inc fell as much as 5 percent on Friday to their lowest in nearly three months after the surprise departure of Chief Product Officer Chris Cox, at a time when the company is again being scrutinized over its handling of privacy, extremism and political content.

FILE PHOTO: Facebook Chief Product Officer Chris Cox speaks at Facebook Inc's annual F8 developers conference in San Jose, California, U.S. May 1, 2018. REUTERS/Stephen Lam/File Photo

FILE PHOTO: Facebook Chief Product Officer Chris Cox speaks at Facebook Inc’s annual F8 developers conference in San Jose, California, U.S. May 1, 2018. REUTERS/Stephen Lam/File Photo

Cox, a Wall Street favorite who has worked with Facebook founder Mark Zuckerberg for 13 years, led the social network’s business development team and helped define the business model of its messaging service WhatsApp.

“We believe Cox played a critical role in establishing FB’s mission, values, and culture, and he was extremely well-regarded inside and outside the company, including by Wall Street,” JPMorgan analysts wrote in a research note.

Also departing is WhatsApp Vice President Chris Daniels, adding to a string of recent high-profile exits from Facebook’s product and communications teams.

Facebook, Twitter and Google were also facing another round of public discussions over extremist content on their platforms on Friday, after video footage of mass shootings in New Zealand was live streamed and widely shared online.

“The live-streaming of New Zealand’s shooting will certainly bring on more questions of regulation and scrutiny over Facebook. It helped provide a platform for today’s horrific attack and will undoubtedly be called into question for facilitating the spread of this,” said Clement Thibault, analyst at global financial markets platform Investing.com.

The gunman, who was part of attacks that killed 49 people in New Zealand, broadcast live footage on Facebook of the attack on one of the mosques, leading to calls for more content moderation by the social network.

Britain’s interior minister Sajid Javid said social media firms must take action to stop extremism on their channels after Friday’s shootings.

“You really need to do more @YouTube @Google @facebook @Twitter to stop violent extremism being promoted on your platforms,” Javid wrote on Twitter.

The social media companies have said they would take down content involving the mass shootings, which were posted online as the attack unfolded.

Facebook has been investing heavily to weed out fake content from its platform and has hired thousands of employees for moderating content and suspended hundreds of suspicious accounts in different countries.

The company’s shares were down 2.5 percent at $165.83 in midday trade.

(Reporting by Supantha Mukherjee in Bengaluru; Editing by Patrick Graham and Bernard Orr)

Wall Street gains as U.S.-China trade talks advance

Traders work on the floor of the New York Stock Exchange (NYSE) in New York, U.S., February 13, 2019. REUTERS/Brendan McDermid

By Amy Caren Daniel

(Reuters) – U.S. stocks gained on Friday, led by a bounce in shares of financials, as investors were optimistic about the ongoing trade talks to resolve a bruising tariff dispute between the United States and China.

Talks between the world’s largest economies will continue next week in Washington, with both sides saying this week’s negotiations in Beijing made good progress.

“Trade talks have been completed in Beijing and the good news is that they are planning on having another round of negotiations in Washington next week,” said Art Hogan, chief market strategist at National Securities in New York.

“The market is predicated on a positive outcome from the trade negotiations.”

Hopes of a trade deal ahead of a March 1 deadline has helped the trade-sensitive industrial sector gain more than 16 percent so far this year, making it the best performing S&P sector.

The sector rose 0.97 percent boosted by bellwethers Boeing Co and Caterpillar Inc.

Leading the gains among the 11 major S&P sectors trading higher were financial companies up 1.66 percent, after a more than 1 percent fall in the prior session.

The sector was hit by a fall in U.S. treasury yields on Thursday after bleak retail sales data in December suggested a sharp slowdown in economic activity at the end of 2018.

Another concern for markets was a threat by President Donald Trump to declare a national emergency in an attempt to fund his U.S.-Mexico border wall without congressional approval.

Still, he agreed to sign the bill that lacked money for his wall, but prevents another damaging government shutdown.

At 9:53 a.m. EDT the Dow Jones Industrial Average was up 275.89 points, or 1.08 percent, at 25,715.28, the S&P 500 was up 22.19 points, or 0.81 percent, at 2,767.92 and the Nasdaq Composite was up 21.83 points, or 0.29 percent, at 7,448.79.

PepsiCo Inc shares rose 2.6 percent after the soda maker forecast an increase in revenue growth. Nvidia Corp rose 2.0 percent and helped push the technology sector 0.29 percent higher, after the chipmaker forecast sales for its current fiscal year above expectations.

Advancing issues outnumbered decliners by a 3.76-to-1 ratio on the NYSE and a 2.69-to-1 ratio on the Nasdaq.

The S&P index recorded 38 new 52-week highs and no new lows, while the Nasdaq recorded 43 new highs and 10 new lows.

(Reporting by Amy Caren Daniel and Shreyashi Sanyal in Bengaluru; Editing by Arun Koyyur)

Shares surge to 2-month high, dollar climbs ahead of Trump speech

FILE PHOTO - Visitors look at an electronic stock quotation board at the Tokyo Stock Exchange (TSE) in Tokyo, Japan, October 1, 2018. REUTERS/Toru Hanai

By Lewis Krauskopf

NEW YORK (Reuters) – World stocks raced to a fresh two-month high on Tuesday to keep up their fast start to 2019 while the U.S. dollar strengthened for a fourth straight session as investors awaited President Trump’s annual State of the Union speech later in the day.

With European shares posting strong gains and Wall Street opening solidly higher, MSCI’s gauge of stocks across the globe gained 0.60 percent, rising for a sixth straight session as it hit a two-month high.

Trump was due to give his address at 2100 ET (0200 GMT), with investors awaiting indications of progress in U.S.-China trade talks and watching for signs of tensions with Democrats following a 35-day partial federal government shutdown.

The Federal Reserve’s dovish recent statement on interest rate policy, along with optimism over U.S.-China tensions, has fueled recent risk appetite, even as estimates for U.S. corporate earnings have been falling.

“Despite the State of the Union tonight, investors seem increasingly certain that we are going to avoid any escalation of the trade tensions with China and avoid another government shutdown,” said Jeffrey Kleintop, chief global investment strategist at Charles Schwab in Boston.

“Investors are viewing policy considerations offsetting falling earnings expectations,” Kleintop said.

On Wall Street, the Dow Jones Industrial Average rose 168.25 points, or 0.67 percent, to 25,407.62, the S&P 500 gained 11.94 points, or 0.44 percent, to 2,736.81 and the Nasdaq Composite added 55.71 points, or 0.76 percent, to 7,403.24.

Shares of Esta Lauder Cos and Ralph Lauren reacted favorably to the companies’ respective quarterly reports.

Fourth-quarter earnings for companies on the benchmark S&P 500 index were on track to have climbed 15.4 percent, but profit in the first quarter is now expected to rise by only 0.5 percent, according to IBES data from Refinitiv.

The pan-European STOXX 600 index rose 1.33 percent, as BP shares jumped after its earnings report.

The dollar index, which measures the greenback against a basket of currencies, rose 0.22 percent, up for a fourth straight session, with the euro down 0.24 percent to $1.1408.

Continued recovery in investors’ appetite for risk-taking exerted pressure on safe-haven currencies, dragging the Swiss franc to an 11-week low against the dollar.

U.S. Treasury yields fell as investors started to price in the Fed’s dovish interest rate outlook amid an uncertain global economic outlook.

“Yields are consolidating around levels that are more consistent with the new position at the Fed which is … it is effectively on hold at least in the next six months,” said John Herrmann, rates strategist at MUFG Securities in New York.

Benchmark U.S. 10-year notes last rose 7/32 in price to yield 2.6983 percent, from 2.724 percent late Monday.

U.S. crude fell 0.24 percent to $54.43 per barrel and Brent was last at $62.60, up 0.14 percent on the day.

(Additional reporting by Gertrude Chavez-Dreyfuss and Saqib Iqbal Ahmed in New York, Marc Jones in London; Editing by Bernadette Baum)

U.S. stocks attempt rebound

A trader works on the floor of the New York Stock Exchange (NYSE) in New York, U.S., December 26, 2018. REUTERS/Jeenah Moon

By Medha Singh

(Reuters) – U.S. stocks were attempting a modest rebound on Wednesday, boosted by technology shares and an Amazon-led jump in retailers, following four sessions of steep losses that pushed the S&P 500 and Dow Industrials near bear market territory.

After a strong start, the S&P and Dow swung between gains and losses. At its session low, the S&P hit a fresh 20-month low and came within two points of entering bear market territory, measured by a drop of more than 20 percent from a closing high.

The gains were led by technology stocks, which rose 1.49 percent. Their 9.2 percent slump in the past four sessions was the steepest among the 11 major S&P sectors, while the S&P 500 tumbled 7.7 percent.

Amazon.com Inc jumped 4.02 percent after reporting a “record-breaking” season. The stock was giving the biggest boost to the S&P and Nasdaq and led the consumer discretionary index up 1.49 percent.

But investors anxieties were far from gone. President Donald Trump renewed his attack on the Federal Reserve on Christmas, blaming it for the market slump.

Trump also said the U.S. government shutdown, now in its fifth day, would last until his demand for funds to build a wall on the U.S.-Mexico border is met.

A little over 2,100 stocks on the New York Stock Exchange and the Nasdaq hit 52-week lows. That compares with at least 2,600 stocks breaching new lows in the past three sessions.

“The market doesn’t look so healthy. The concerns are government shutdown, the economy, the President – what time is he going to tweet out about Federal Reserve,” said Larry Benedict, founder of the Opportunistic Trader in Boca Raton, Florida.

“We’re seeing the same thing recently and it’s not really good. It opens up every day and it’s met by selling and it ends nearer the low or on the low than the high. For the market to make a bottom, you need a bit of capitulation or panic bottom.”

The S&P was up 24.41 points, or 1.04 percent, at 2,375.51, at 11:37 a.m. ET, a day after the Christmas holiday.

The Dow Jones Industrial Average was up 196.31 points, or 0.90 percent, at 21,988.51 and the Nasdaq Composite was up 98.42 points, or 1.59 percent, at 6,291.34.

Eight of the 11 S&P sectors were higher, with the defensive utilities. SPLRCU real estat and consumer staples flat to lower.

Energy stocks rose 1.8 percent as crude oil prices rebounded.

Retailers jumped 3.14 percent, led by Amazon after a Mastercard report showed U.S. holiday sales were the strongest in six years.

The heavy-weight FAANG group, Facebook Inc, Amazon, Apple Inc, Netflix Inc and Alphabet Inc, rose between 1 percent and 4 percent.

The S&P ended Monday 19.8 percent below its all-time closing high, with roughly three-fourths of its stocks already in a bear market.

The Dow finished Monday 18.9 percent lower than its closing high. The Nasdaq is already in bear market, along with the Dow Jones Transport Average and small-cap Russell 2000 index.

Advancing issues outnumbered decliners by a 1.70-to-1 ratio on the NYSE and a 1.89-to-1 ratio on the Nasdaq.

The S&P index recorded no new 52-week highs and 194 new lows, while the Nasdaq recorded five new highs and 455 new lows.

(Reporting by Medha Singh in Bengaluru; Editing by Anil D’Silva)

Wall St. hits fresh year-lows on threat of government shutdown, slowing growth

Traders work on the floor of the New York Stock Exchange (NYSE) in New York, U.S., December 21, 2018. REUTERS/Bryan R Smith

By Medha Singh

(Reuters) – Wall Street fell in volatile trading on Friday, after a few failed attempts at a rally, led by a drop in technology and other high-growth sectors, while defensive stocks rose amid concerns of slowing growth and a looming government shutdown.

The three major indexes swung between losses and gains of more than 1 percent as fragile investor nerves were tested by news of turmoil in Washington and soothing comments from an influential Federal Reserve official.

The S&P 500, already on pace for its worst December since the Great Depression, hit its lowest since August 2017. The Dow fell to its lowest since October 2017, while the Nasdaq sank to a 15-month low, toying with bear market territory for the second day in a row.

The defensive consumer staples, utilities and real estate sectors logged gains of 0.1 percent to 0.77 percent, while all the other eight S&P sectors declined.

“Investors are looking for cover. Within equities, investors are certainly gravitating towards the traditionally defensive segments of the market,” said Mike Loewengart, vice-president of investment strategy at E*TRADE Financial in New York.

The technology index sank 1.54 percent, while communication services, which houses high-growth names such as Facebook Inc and Alphabet Inc, dropped 2.2 percent.

President Donald Trump said there was a very good chance a government funding bill, which included funding for a wall along Mexico border, would not pass the Senate. Those worries were compounded by the sudden resignation of U.S. Defense Secretary Jim Mattis.

“I think it’s a confluence of all the known issues that the investors have been digesting for the last few weeks. We have the prospect of a government shutdown today. We have more shakeups within the Trump administration,” Loewengart said.

The markets got a lift earlier after New York Fed President John Williams said on CNBC the central bank is open to reassessing its views and listening to market signals that the economy could fall short of expectations.

Williams’ comments come after the Fed said on Wednesday it would largely stick to its plan to keep raising interest rates, spooking investors already grappling with mounting evidence of slowing growth and triggering the slide on Wall Street.

At 1:20 p.m. ET, the Dow Jones Industrial Average was down 169.07 points, or 0.74 percent, at 22,690.53, the S&P 500 was down 24.57 points, or 1.00 percent, at 2,442.85 and the Nasdaq Composite was down 127.58 points, or 1.95 percent, at 6,400.83.

Adding to the mix was “quadruple-witching,” when options on stocks and indexes as well as futures on indexes and stocks expire, tending to raise volumes.

Helping stanch the bleeding on Friday was Nike Inc, which jumped 6.2 percent after the company’s quarterly results beat Wall Street estimates on strength in North America. The stock was the biggest driver of gains on the Dow and S&P.

The three main Wall Street indexes are already in correction territory, having fallen more than 10 percent from their record closing highs. They are closing in on bear market territory, which is marked when an index closes more than 20 percent below its closing high.

Declining issues outnumbered advancers for a 2.52-to-1 ratio on the NYSE and a 3.32-to-1 ratio on the Nasdaq. The S&P index recorded no new 52-week highs and 102 new lows, while the Nasdaq recorded four new highs and 659 new lows.

(Reporting by Medha Singh in Bengaluru; Editing by Shounak Dasgupta)

China confident on U.S. trade pact, Trump cites Xi’s ‘strong signals’

FILE PHOTO: U.S. President Donald Trump takes part in a welcoming ceremony with China's President Xi Jinping in Beijing, China, November 9, 2017. REUTERS/Damir Sagolj

By John Ruwitch

SHANGHAI (Reuters) – China expressed confidence on Wednesday that it can reach a trade deal with the United States, a sentiment echoed by U.S. President Donald Trump a day after he warned of more tariffs if the two sides could not resolve their differences.

The remarks, by the Chinese Commerce Ministry, follow a period of relative quiet from Beijing after Trump and Chinese leader Xi Jinping reached a temporary truce in their trade war at a meeting over dinner in Argentina on Saturday.

In a brief statement, the ministry said China would try to work quickly to implement specific items already agreed upon, as both sides “actively promote the work of negotiations within 90 days in accordance with a clear timetable and roadmap”.

“We are confident in implementation,” it said, calling the latest bilateral talks “very successful”.

Trump, in a post on Twitter, linked Beijing’s silence to officials’ travels and said he thought Xi had been sincere during their weekend meeting to hammer out progress over trade.

“Very strong signals being sent by China once they returned home from their long trip, including stops, from Argentina. Not to sound naive or anything, but I believe President Xi meant every word of what he said at our long and hopefully historic meeting. ALL subjects discussed!” Trump wrote on Wednesday.

The U.S. president a day earlier had said the ceasefire could be extended but warned tariffs would be back on the table if the talks failed and that he would only accept a “real deal” with China.

China’s Foreign Ministry referred specific questions to the Commerce Ministry, which is due to hold its weekly news briefing on Thursday in Beijing.

“We hope the two working teams from both sides can, based on the consensus reached between the two countries’ leaders, strengthen consultations, and reach a mutually beneficial agreement soon,” Foreign Ministry spokesman Geng Shuang told reporters.

The threat of further escalation in the trade war between the world’s two largest economies has loomed large over financial markets and the global economy for much of the year, and investors initially greeted the ceasefire with relief.

The mood has quickly soured, however, on skepticism that the two sides can reach a substantive deal on a host of highly divisive issues within the 90-day negotiating period, and markets continued to slide on Wednesday in part from confusion over the ceasefire’s lack of detail.

Failure would raise the specter of a major escalation in the trade battle, with fresh U.S. tariff action and Chinese retaliation possibly as early as March.

The White House has said China had committed to start buying more American products and lifting tariff and non-tariff barriers immediately while beginning talks on structural changes with respect to forced technology transfers and intellectual property protection.

Sources told Reuters that Chinese oil trader Unipec plans to resume buying U.S. crude by March after the Xi-Trump deal reduced the risk of tariffs on those imports. China’s crude oil imports from the U.S. had ground to a halt.

MARKETS DOWN

Global financial markets sank to one-week lows on Wednesday amid the renewed trade concerns, extending Tuesday’s slide.

U.S. markets were closed on Wednesday to observe former President George H.W. Bush’s death, but the effect of Wall Street’s turmoil the previous day was felt in Europe and Asia with the benchmark Shanghai stock index closing down 0.6 percent.

“Narrow agreements and modest concessions in the ongoing trade dispute will not bridge the wide gulf in their respective economic, political and strategic interests,” Moody’s Investors Service said in a report that predicted U.S.-China relations “will remain contentious”.

Officials from the United States and a number of other major economies have often criticized China for its slow approach to negotiations and not following through on commitments.

China has said comparatively little about the Trump-Xi agreement after senior Chinese officials briefed the media following the meeting, and U.S. and Chinese accounts of what the deal entails have sometimes differed.

“Officials now face the difficult task of fleshing out a deal that is acceptable to the Chinese but also involves significant enough concessions not to be torpedoed by the China hawks in the Trump administration,” Capital Economics said in a note this week, adding that higher tariffs could simply be delayed.

A Chinese official told Reuters that officials were “waiting for the leaders to return” before publicizing details.

President Xi and his most senior officials are due back in China on Thursday, having visited Panama and Portugal since leaving Argentina.

On Wednesday, the Global Times tabloid, which is run by the Chinese Communist Party’s main newspaper, said the Trump administration’s statements about the deal – including the agreement that China would buy $1.2 trillion in additional U.S. goods – were designed to highlight or even exaggerate facets of the deal that benefited the United States.

“It will be a win-win situation if a deal is realized. But if not, more fights and talks will continue alternately for a long while. Chinese society should maintain a calm attitude,” it said.

(Reporting by John Ruwitch and Wang Jing in Shanghai, Philip Wen in Beijing and Makini Brice in Washington; Writing by Ben Blanchard; Editing by Kim Coghill and Steve Orlofsky)