Stocks - Wall Street Tumbles as Trade Tensions Escalate

Investing.com – Wall Street fell on Wednesday as tensions between the U.S. and China put a damper on any hope of a trade breakthrough between the two.

The Dow was down 49 points, or 0.2%, by 9:37 AM ET (13:37 GMT), while the S&P 500 inched down 4 points, or 0.1%, and the Nasdaq composite slumped 18 points, or 0.2%.

Tensions were exasperated by the U.S. Senate passing legislation backing Hong Kong protesters that would ban the export of items like tear gas and rubber bullets to the city's police force, as conflict between the two sides escalated this week. Chinese foreign ministry spokesman Geng Shuang lashed out against the vote, saying it “seriously violated international law and basic norms governing international relations.”

The news added to jitters after U.S. President Donald Trump reiterated that he would raise tariffs if phase one of a trade deal with China is not signed.

"The biggest concern (to markets) is the Senate action with respect to Hong Kong," said Rick Meckler, partner, Cherry Lane Investments, a family investment office in New Jersey.

"China has been clear that they don't want to see any foreign interference in Hong Kong. That's the real negative to start today's market."

Stocks sensitive to trade tumbled, with Apple (NASDAQ:AAPL) down 0.2%, Advanced Micro Devices (NASDAQ:AMD) falling 0.4% and Caterpillar (NYSE:CAT) slipping 0.7%.

Urban Outfitters (NASDAQ:URBN) slumped 13.3% after missing third-quarter profit and sales forecasts, while Bristol-Myers Squibb (NYSE:BMY) fell 0.4% after late-stage trial testing of a cancer treatment missed a main goal of preventing skin cancer from recurring in a certain group of patients.

Elsewhere, Target (NYSE:TGT) jumped 8% after raising its full-year profit guidance ahead of the holiday season and Lowe’s (NYSE:LOW) gained 5% on upbeat earnings.

In commodities, the U.S. dollar index, which measures the greenback against a basket of six major currencies, was up 0.1% to 97.865 and gold futures slipped 0.2% to $1,470.55 a troy ounce. Crude oil futures rose 0.8% to $55.80 a barrel.

-Reuters contributed to this report

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