The selloff in U.S. stocks deepened as the White House’s latest trade bluster rattled global financial markets.
The S&P 500 Index plunged more than 2 percent and all 30 members of the Dow Jones Industrial Average retreated as President Donald Trump ordered ordered a review of additional tariffs that prompted an aggressive response from China. Fresh attempts by White House officials to tone down the bluster failed to calm nerves, with the Cboe Volatility Index back above 21. Treasury Secretary Steven Mnuchin added to the anxiety by saying there’s a “level of risk” the spat could worsen.
Trump said the market turmoil was short-term “ pain,” but insisted the outcome would leave the U.S. in a better position. The president’s top economic adviser said the U.S. and China are holding “back-channel discussions” to resolve an escalating trade dispute that has unsettled global financial markets. China earlier said no talks were ongoing.
The trade tensions overshadowed the latest U.S. jobs report, which showed hiring cooled by more than forecast in March. The renewed saber rattling provided a bookend to a week that started with equities tumbling amid amplified rhetoric. That gave way to a three-day rally after White House officials signaled the president’s tough talk was part of a negotiating plan.
“It’s bad when this happens on a Friday, because then people get freaked out over the weekend,” Donald Selkin, New York-based chief market strategist at Newbridge Securities Corp, said by phone. “The worst thing you want to see is a bad market late on a Friday.” Terminal users can read our markets live blog here.
These are the main moves in markets:
The S&P 500 fell 2.5 percent as of 2:41 p.m. in New York. The Nasdaq Composite Index lost 2.3 percent. The Stoxx Europe 600 Index sank 0.4 percent The MSCI All-Country World Index fell 0.8 percent.
The Bloomberg Dollar Spot Index fell 0.2 percent. The euro rose 0.3 percent to $1.2275. The British pound gained 0.6 percent to $1.4090. The Japanese yen rose 0.3 percent to 107.11.
The yield on 10-year Treasuries declined five basis points to 2.786 percent, the largest fall in more than a week. Britain’s 10-year yield declined two basis points to 1.418 percent, the biggest drop in more than a week. Germany’s 10-year yield dipped one basis point to 0.52 percent, the largest dip in more than a week.
The Bloomberg Commodity Index decreased 0.3 percent. West Texas Intermediate crude dipped 2.5 percent to $61.96 a barrel. Gold rose 0.4 percent to $1,331.29 an ounce. — Bloomberg