Wednesday, February 28, 2024

Stocks pull back on Wall Street as trade worries flare again

by Associated Press

Stocks are opening lower on Wall Street as traders worry that trade tensions could flare again with China and as protests spread across the U.S. against police brutality, potentially threatening more outbreaks of the coronavirus. The S&P 500 index fell 0.4% in the first few minutes of trading Monday, led by declines in technology and health care companies. The index is coming off its second month of solid gains. Overseas, Hong Kong’s market rose after President Donald Trump didn’t pull out of a trade truce reached earlier with China. But traders still worried that more trade friction was on the way.

THIS IS A BREAKING NEWS UPDATE. AP’s earlier story is below:

Global stock markets mostly rose Monday after President Donald Trump avoided reigniting a trade war with China, though U.S. indexes appeared set to open lower amid concerns about the violent protests erupting across the country.

Hong Kong’s stock market surged more than 3% and European shares traded higher, while Wall Street futures were down slightly.

Investors appeared relieved that Trump avoided pulling out of a truce in a tariff war with Beijing in his response to Beijing’s security law on Hong Kong.

In the U.S., that seemed overshadowed by the civic unrest, where protests against police brutality and racism have become violent in multiple cities. The protests come at a time of surging unemployment and just as the country was looking to ease its lockdown measures. Some fear the demonstrations could lead to a new increase in coronavirus contagions.

Futures for the benchmark S&P 500 index and the Dow Jones Industrial Average were both down 0.1%.

In Europe, the FTSE 100 in London added 1% to 6,139 and the CAC 40 in France advanced 1.1% to 4,747 after new surveys showed a recovery in manufacturing activity, though it is still contracting due to the pandemic lockdowns. German markets were closed for a holiday.

Earlier, in Asia, Hong Kong’s Hang Seng index jumped 3.4% to close at 23,732.52. The Shanghai Composite Index rose to 2,915.43 and the Nikkei 225 in Tokyo added 0.8% to 22,062.39.

A monthly gauge of Chinese manufacturing issued by a business magazine, Caixin, edged up to a four-month high, but new export orders fell from an already low level in a sign of weak global demand.

In Seoul, the Kospi in Seoul added 1.7% to 2,065.08. Australia’s S&P-ASX 200 was 1.1% higher at 5,819.20 and India’s Sensex added 3.2% to 33,474.98. Singapore gained 1.9% and Bangkok rose 0.6%.

U.S.-Chinese tension has weighed on investor optimism about the global economy’s recovery from its deepest slump since the 1930s.

As China and some European countries revive economic activity, stock markets have been regaining much of this year’s losses despite rising numbers of virus cases in the United States, Brazil and some other countries.

Before the virus outbreak, the global economy already was under pressure from the U.S.-Chinese dispute over Beijing’s technology ambitions and trade surplus.

The world’s two biggest traders had raised tariffs on billions of dollars of each other’s goods. They signed a truce in January but Trump has added to market jitters by threatening to pull out if China doesn’t buy more American goods.

On Friday, Trump said Washington would begin eliminating agreements that gave Hong Kong privileges that China lacked, including exemption from some import controls.

That followed the ceremonial Chinese legislature’s endorsement of a security law for Hong Kong that pro-democracy advocates say undermines the autonomy promised to the former British colony.

It is unclear how the decision might affect U.S. companies in Hong Kong or the territory’s status as a finance and business center. Business groups say the uncertainty might hurt its appeal to foreign investors.

In energy markets, benchmark U.S. crude lost 8 cents to $35.41 per barrel in electronic trading on the New York Mercantile Exchange. The contract gained $1.78 on Friday to settle at $35.49. Brent crude, used to price international oils, gained 23 cents to $38.07 per barrel in London.

The dollar declined to 107.72 yen from Friday’s 107.81. The euro retreated to $1.1113 from $1.1165.

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