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Stocks slide as modest rally fades ahead of trade talks

Stocks slide as modest rally fades ahead of trade talks

May 9th, 2019 by the Associated Press in Business

FILE - In this March 11, 2019, file photo specialist Peter Mazza, left, and trader James Riley work on the floor of the New York Stock Exchange. The U.S. stock market opens at 9:30 a.m. EDT on Wednesday, May 8. (AP Photo/Richard Drew, File)

A modest rally faded in the last few minutes of trading on Wall Street, leaving stocks slightly lower Wednesday ahead of the latest round of trade talks between the U.S. and China.

The late-afternoon reversal added to the market’s losses following a steep sell-off a day earlier as investors worry the costly trade dispute between the world’s two biggest economies will escalate.

Financial markets turned volatile this week after President Donald Trump threatened to impose more tariffs on Chinese goods, a threat that is set to become reality early Friday. Negotiations between the U.S. and China are scheduled to continue today in Washington, and will include China’s top trade official.

Trump said on Twitter that China is coming “to make a deal” but that he’ll still be ready to raise tariffs if the negotiations fail to produce an agreement.

That appeared to give the market a boost, but it didn’t last.

“Investors are concerned that a deal may not be forthcoming,” said Quincy Krosby, chief market strategist at Prudential Financial. “You don’t want to be caught off-guard by perhaps a negative comment out of Beijing overnight or, for that matter, the White House.”

The S&P 500 index fell 4.63 points, or 0.2 percent, to 2,879.42. The benchmark index had been up 0.5 percent.

The Dow Jones Industrial Average inched up 2.24 points, or less than 0.1 percent, to 25,967.33. The Nasdaq composite dropped 20.44 points, or 0.3 percent, to 7,943.32.

The Russell 2000 index of small company stocks slid 7.34 points, or 0.5 percent, to 1,574.97.

Major stock indexes in Europe closed with modest gains.

Bond prices fell. The yield on the 10-year Treasury rose to 2.48 percent from 2.44 percent late Tuesday.

Utilities, banks, internet companies and technology stocks accounted for much of the slide. NRG Energy fell 4.4 percent, Capital One Financial dropped 1.5 percent, Netflix slid 1.6 percent and Intel lost 2.5 percent. Health care stocks notched the biggest gains, led by McKesson Crop., which climbed 4.8%.