Stocks today closed with heavy losses Friday, as the U.S.-China trade war intensified and investors rushed into safe havens. The sell-off quashed a market rebound this week.
XThe Nasdaq composite tumbled 3% for the week, dashing hopes that the composite would climb back above its 50-day moving average. Instead, the 50-day line has once again proved to be a level of resistance.
The S&P 500 shed 2.6% and the Dow Jones Industrial Average 2.4%. The Dow closed barely above its 200-day moving average. Indexes closed near session lows.
All three indexes made it four down weeks in a row, and the market is on pace for its worst month since May. Volume Friday was sharply higher from Thursday's totals.
The small-cap Russell 2000 lost 3% as well. Invesco QQQ Trust (QQQ), which was nearer to marking a close above the 50-day line, plunged 3.2%.
Trade headlines overshadowed Fed Chairman Jerome Powell's speech in Jackson Hole, Wyo., Friday.
Wall Street opened lower after China reimposed a 25% tariff on imports of American-built autos and announced tariffs of 5% to 10% on additional $75 billion in U.S.-made goods.
U.S. indexes pared early losses after reading Powell's comments. Powell sees rising risks for the global economy and said the Federal Reserve will be ready to respond to signs of weakness. But the market sold off sharply after President Donald Trump posted a series of tweets that criticized both Powell and China. Trump urged U.S. businesses not to do business with that country.
These Sectors Fall The Most Amid China Trade War
Trade-sensitive sectors were hammered. The Philadelphia semiconductor index plunged 4.3%. The Dow transports slid 3.3%. Retail, another sector that relies heavily on Chinese imports, was Friday's weakest. SPDR S&P Retail ETF (XRT) skidded 3.8%. Amazon.com (AMZN) fell to the lowest price since June 6 and remains at the toes of a new base.
The yield on the 10-year Treasury note fell 8 basis points to 1.53% late Friday as investors raced for safe havens. Gold, which often climbs in times of economic uncertainty, shot up. SPDR Gold Shares (GLD), the ETF that tracks the price of bullion, hit the highest level since April 2013.
Keysight Technologies (KEYS), an IBD 50 member, fell sharply and erased all gains from the 94.62 buy point of Thursday's breakout on earnings.
Lyft (LYFT) extended its decline and is close to its May 13 record low of 47.17. The ride-share service is more than 30% below its IPO price of 72 a share.
Juan Carlos Arancibia is the Markets Editor of IBD and oversees our market coverage. Follow him at @IBD_jarancibia
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