Wall St flat, tech boost softens trade war fears

A trader works on the floor of the New York Stock Exchange (NYSE) in Manhattan January 19, 2017. — Reuters pic
A trader works on the floor of the New York Stock Exchange (NYSE) in Manhattan January 19, 2017. — Reuters pic

NEW YORK, Sept 11 — US stocks were little changed today, as gains in technology stocks helped the Nasdaq regain footing and curbed losses in the materials and industrials sectors due to fears of an escalation in Sino-US trade spat.

President Donald Trump on Friday threatened duties on US$267 billion (RM1.1 trillion) of goods on top of planned tariffs on US$200 billion of Chinese products. China has vowed to respond if the United States took any new steps on trade.

China has also decided to approach the World Trade Organisation next week for permission to slap sanctions on the United States, for Washington’s non-compliance with a ruling in a dispute over US dumping duties.

“The pressure point today clearly seems to be about trade more than anything else. China’s been playing such a long game and none of that has been good for the markets,” said Art Hogan, chief market strategist at B. Riley FBR in New York.

“Today feels like the day we were expecting yesterday, but the WTO complaint has been stirring up this escalation, which has reignited our concerns about trade in general.”

Nine of the 11 major S&P sectors were trading lower, with a 0.54 per cent drop in the materials sector leading the decliners as metal prices fell on trade war rhetoric.

However, gains in internet stocks kept the Nasdaq afloat, with Facebook rising 0.8 per cent, Twitter 1.9 per cent and Google-parent Alphabet 0.5 per cent.

The trade-sensitive industrials sector fell 0.31 per cent, with shares of Caterpillar and Boeing falling 0.4 per cent and 1 per cent, respectively.

Boeing earlier raised its estimate for purchase of new planes by China over the next two decades by 6.2 per cent.

Shares of chipmakers, which rely on China for a major portion of their revenue, also fell. Intel was down 1 per cent and Micron 3.7 per cent.

At 10.03am ET the Dow Jones Industrial Average was down 13.84 points, or 0.05 per cent, at 25,843.23, the S&P 500 was down 1.76 points, or 0.06 per cent, at 2,875.37 and the Nasdaq Composite was up 5.91 points, or 0.07 per cent, at 7,930.07.

Also in focus was Hurricane Florence, now a Category 4 storm that is expected to grow stronger before making landfall on Thursday, most likely in southeastern North Carolina near the South Carolina border.

Insurers fell for the second straight day on the storm warning with Travellers down 0.4 per cent, Progressive Corp 0.1 per cent and American International Group 1.4 per cent. However, home improvement chain Home Depot rose about 0.6 per cent.

Nike rose 1.2 per cent after brokerage Canaccord Genuity upgraded the world’s No.1 sportswear maker’s shares, citing that the company has regained its footing and is solidly marching back to top form.

Integrated Device Technology jumped 11.3 per cent after Japan’s Renesas Electronics agreed to buy chipmaker in a US$6.7 billion deal to deepen its push into semiconductors for self-driving cars.

Declining issues outnumbered advancers for a 1.59-to-1 ratio on the NYSE and for a 1.27-to-1 ratio on the Nasdaq.

The S&P index recorded 15 new 52-week highs and 12 new lows, while the Nasdaq recorded 56 new highs and 57 new lows.— Reuters

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