By Medha Singh
(Reuters) - U.S. stocks sank over 1 percent to session lows on Thursday on fears that the United States and China would not be able to reach a trade deal with less than a month left in their fragile truce, adding to worries about a slowdown in global growth.
A meeting between U.S. President Donald Trump and Chinese President Xi Jinping was unlikely to take place by March 2, the deadline set by the two countries for reaching a trade deal, two U.S. administration officials and a source said.
That came minutes after White House adviser Larry Kudlow told Fox Business Network that there was a pretty sizable distance to go in the trade talks. The next round of discussions will take place in Beijing in the coming week.
"We've been selling off all day. The fear started this morning from headlines coming out of Europe that EU growth was slowing," said Dennis Dick, head of markets structure, proprietary trader at Bright Trading LLC in Las Vegas.
"We've been straight up for a month with very little pullback. Europe kick started us to the downside this morning and then there was follow-through from the Trump headline and all of a sudden you have an overdue sell-off on your hands."
The European Commission slashed its economic growth forecasts for the euro zone this year and next because of an expected slowdown in the largest countries of the bloc, partly due to trade tensions.
After a strong run in January, mainly on easing trade fears, the Federal Reserve dialing back on interest rates and largely upbeat earnings reports, Wall Street has got off to a strong start this month, even as disappointing forecasts from a number of U.S. companies are giving investors pause.
More than half the S&P 500 companies have reported results, and about 70 percent of them have beat profit estimates, according to IBES data from Refinitiv. However, earnings growth estimates for the current-quarter have dropped to 0.1 percent from 5.3 percent at the start of the year.
"Investors also think earnings are going to slow in the next few quarters."
At 11:50 a.m. ET the Dow Jones Industrial Average was down 337.05 points, or 1.33 percent, at 25,053.25, the S&P 500 was down 38.44 points, or 1.41 percent, at 2,693.17 and the Nasdaq Composite was down 121.02 points, or 1.64 percent, at 7,254.26.
Twitter Inc dropped 10.8 percent after the company forecast first-quarter revenue below estimates and reported a drop in users for the fourth quarter.
Declining issues outnumbered advancers for a 3.57-to-1 ratio on the NYSE and a 2.95-to-1 ratio on the Nasdaq.
The S&P index recorded nine new 52-week highs and two new lows, while the Nasdaq recorded 25 new highs and 24 new lows.
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)