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US-STOCKS-MARKETS
US stocks end lower on trade war fears, Dow -1.0%
NEW YORK, June 1, 2018 (BSS/AFP) – Wall Street stocks finished solidly
lower Thursday after a Trump administration announcement of tariffs on steel
and aluminum imports from Europe, Canada and Mexico deepened fears of a trade
war.
The Dow Jones Industrial Average finished down 1.0 percent or 250 points
at 24,415.84.
The broad-based S&P 500 shed 0.7 percent to close at 2,705.27, while the
tech-rich Nasdaq Composite Index declined 0.3 percent to 7,442.12.
Stocks were under pressure the entire session following an announcement
from Commerce Secretary Wilbur Ross that the US would impose stiff tariffs on
metals imports from some of its most longstanding allies.
Losses deepened later in the session, especially when the US policy was
denounced by Canadian Prime Minister Justin Trudeau, who announced
retaliatory duties on up to Can$16.6 billion (US$12.8 billion) in American
imports.
“These tariffs are an affront to the long standing security partnership
between Canada and the United States, and in particular, an affront to the
thousands of Canadians who have fought and died alongside their American
brothers in arms,” Trudeau said, dismissing the US national security
justification for its measures.
Mexico also announced retaliatory duties, and the EU is expected to do so
soon.
Companies heavily leveraged to international trade, including Caterpillar
and Boeing were among the biggest losers in the Dow, shedding 2.3 percent and
1.7 percent, respectively.
Yet the market’s overall losses, while not insignificant, were also well
below those suffered on the worst trading days earlier this spring.
“Yes there are some pretty ominous headlines, but the market is taking it
pretty well,” said Jack Ablin of Cresset Wealth Advisors.
“There is somewhat of a credibility issue with this administration just
because they continuously change their tack all the time,” Ablin added.
“Investors believe that most of it is posturing and is not policy.”
Most sectors of the S&P 500 finished in negative territory, with utilities
scraping out a modest gain and technology flat.
Tech giants Expedia and Facebook both won more than two percent and
Google-parent Alphabet climbed 1.6 percent.
General Motors powered 12.9 percent higher after it announced that
Japanese telecom giant SoftBank will invest $2.25 billion in the company’s
autonomous car program.
US shares of Deutsche Bank dropped 4.2 percent as its travails with US
regulators deepened. The bank’s US unit has been designated a “problem bank”
by Federal Deposit Insurance Commission, a person familiar with the matter
told AFP.
The big German bank also was downgraded to “troubled condition” by the
Federal Reserve, the Wall Street Journal reported Thursday.
BSS/AFP/HR/0935