Technology companies led a broad slide for stocks on Wall Street on Monday, handing the market a downbeat start to the month after it notched strong gains in November. Trade tensions flared after China retaliated for U.S. support of protesters in Hong Kong, putting investors in a selling mood. Asian regional markets are generally hurt by declines in trade and the slowdown in the Chinese economy that might cause.
Investors have been hoping that the world’s two biggest economies can make progress toward at least staving off new tariffs scheduled for Dec. 15 on $160 billion worth of Chinese products, including smartphones and laptops. The latest friction between Washington and Beijing could hamper that progress.
The S&P 500 index fell 0.9% to 3,113.87. The Dow Jones Industrial Average dropped 1%, to 27,783.04. The Nasdaq lost 1.1%, to 8,567.99. The Russell 2000 index of smaller company stocks gave up 1%, to 1,607.58.
The negotiations to end the longstanding trade war could face a tougher path this month following the flareup over Hong Kong. China said Monday it will suspend U.S. military ship and aircraft visits to the semi-autonomous territory. It also plans to sanction several American pro-democracy groups in retaliation for passage of legislation supporting months’ long anti-government protests.
The law, signed last Wednesday by President Donald Trump, mandates sanctions on Chinese and Hong Kong officials who carry out human rights abuses and requires an annual review of the favorable trade status that Washington grants Hong Kong.
“Perhaps the market will now hold the champagne corks that it has been popping for months now in expectation that all is well,” Rabobank said in a report. ENERGY: Benchmark crude oil gained 21 cents to $56.17 a barrel in electronic trading on the New York Mercantile Exchange. It rose 79 cents to $55.96 a barrel on Monday. Brent crude oil, the international standard, gained 13 cents to $61.05 a barrel.
CURRENCIES: The dollar rose to 109.16 Japanese yen from 109.00 yen on Monday. The euro weakened to $1.1074 from $1.1080.