Wall Street edges lower on global worries
The Dow and S&P 500 has ended slightly lower as investors, worried about global growth prospects, fled from materials and industrials stocks but falling bond yields kept declines in check in the three major indexes.
The International Monetary Fund cut global economic growth forecasts for 2018 and 2019 and its 2019 US and China estimates, saying the two countries would feel the brunt of their trade war next year.
Meanwhile, US President Donald Trump repeated a threat to impose tariffs on $US267 billion ($A376 billion) worth of additional Chinese imports if Beijing retaliates for the recent levies and other measures the United States has taken in the countries' escalating trade war.
The materials index ended down 3.4 per cent, its biggest one-day percentage drop since February 8. Chemical company PPG Industries was its biggest loser, falling 10 per cent after warning that its current-quarter profit would be hit by higher raw material costs and softer demand in China.
"If industrials and materials are weighed on because of concerns about global activity, it's going to cast a pall over the market at large since S&P 500 companies generate about half of their business from overseas markets," said Mark Luschini, chief investment strategist at Janney Montgomery Scott in Philadelphia.
The Dow Jones Industrial Average fell 56.21 points, or 0.21 per cent, to 26,430.57, the S&P 500 lost 4.09 points, or 0.14 per cent, to 2,880.34 and the Nasdaq Composite added 2.07 points, or 0.03 per cent, to 7,738.02.
But the main indexes gained some support from falling US Treasury 10-year yields after a spike last week had put pressure on equities.
"It's almost as if the 10-year looked in the mirror and scared itself. It's come down, so stocks have been given something of a breather," said Kristina Hooper, chief global market strategist at Invesco in New York.
Along with chemicals companies, paper packaging stocks WestRock and Packaging Corp of America both fell 8 per cent, after BMO flagged the risk of rising industry supply.
The trade-sensitive industrials sector lost 1.5 per cent with help from airline stocks, which fell 3 per cent.
American Airlines was its biggest per centage decliner with a 6.5 per cent drop after it said fuel prices were higher than expected in the third quarter, triggering concerns that rising fares were not enough to offset energy costs.
The energy index was the S&P's biggest gainer, with a 1 per cent advance as oil prices rose on growing evidence of falling Iranian crude exports and a partial Gulf of Mexico production shutdown due to Hurricane Michael.
Declining issues outnumbered advancing ones on the NYSE by a 1.13-to-1 ratio; on Nasdaq a 1.51-to-1 ratio favoured decliners.
The S&P 500 posted 16 new 52-week highs and 27 new lows; the Nasdaq Composite recorded 22 new highs and 118 new lows.
Volume on US exchanges was 7.26 billion shares, in line with the 7.27 billion average for the last 20 trading days. (Reporting by Sinead Carew in New York, Shreyashi Sanyal in Bengaluru Additional reporting by Caroline Valetkevitch Editing by Dan Grebler, Toni Reinhold)
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