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Wall Street cuts losses as Larry Kudlow promises China trade talks

Wall Street dropped sharply at the open on fears of an escalating trade war between two countries after Trump threatened to slap an additional $100 billion in tariffs on Chinese goods

Reuters 

Larry Kudlow
Larry Kudlow

recouped some losses on Friday morning after Donald Trump's top said negotiations between the and over trade differences would start soon.

Wall Street dropped sharply at the open on fears of an escalating trade war between two countries after Trump threatened to slap an additional $100 billion in tariffs on Chinese goods and warned it would fight back "at any cost" with fresh trade measures.

Kudlow said on told TV that while trade talks with have not yet begun but will hopefully start in the next few months.

John Doyle, vice of dealing and trading at Tempus in said the equity markets have experienced the bulk of the volatility from the Trump administration's mixed signals, but that the currency markets seemed unperturbed.

"For the most part, currency markets seem to be taking the tit-for-tat trade war threats with a grain of salt.

At 9:51 a.m. ET, the Dow Jones Industrial Average dropped 0.37 percent to 24,414.88. The fell 0.31 percent to 2,654.7 and the Composite declined 0.26 percent to 7,058.23.

The list of decliners were similar to Wednesday's, when the and announced tariffs on $50 billion of each others' imports.

Boeing, the single largest U.S. exporter to China, fell 1.12 percent. declined 1.3 percent and dropped about 2 percent.

Chipmakers, which as a group rely on China for about a quarter of their revenue, also declined. The index fell 0.54 percent.

Eight of the 11 S&P sectors were lower, led by a 0.6 percent drop in financial stocks as the case for further rate hikes dimmed after soft jobs data.

Nonfarm payrolls increased by 103,000 last month, the Labor Department said, the fewest in six months and lower than economists' forecast of 193,000 jobs.

Average hourly earnings rose eight cents or 0.3 percent last month, above the expected 0.2 percent increase. The unemployment rate held steady at 4.1 percent for a sixth straight month.

"That's not showing us wage inflation where the Fed would have to step in. This seems to be a natural improvement," said Sean Lynch, co-head of global equity strategy, Institute in Omaha,

Investors will also tune into Fed Jerome Powell's speech at an event later in the day for signs the central could raise rates more than the expected two more times this year.

Declining issues outnumbered advancers on the NYSE for a 1.41-to-1 ratio and for a 1.28-to-1 ratio favouring decliners on the

First Published: Fri, April 06 2018. 19:47 IST
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