logo
Plus   Neg
Share
Email

U.S. Stocks Regaining Ground After Seeing Early Weakness

wallstreet-aug29_20may19-lt.jpg

Stocks moved mostly lower in early trading on Monday but have regained some ground over the course of the morning. The major averages have climbed well off their worst levels of the day, although the tech-heavy Nasdaq continues to post a steep loss.

Currently, the major averages remain in the red, with the Nasdaq underperforming its counterparts by a wide margin. While the Nasdaq is down 73.19 points or 0.9 percent at 7,743.09, the Dow is down 14.86 points or 0.1 percent at 25,749.14 and the S&P 500 is down 5.77 points or 0.2 percent at 2,853.76.

The early weakness on Wall Street came amid ongoing concerns about the escalating U.S.-China trade dispute after Google suspended some of its business with Chinese tech giant Huawei.

Google has cut Huawei off from business involving the transfer of hardware, software and technical services, complying with an order by President Donald Trump blocking the sale or transfer of U.S. technology to Huawei.

"We are complying with the order and reviewing the implications," a Google spokesperson said, noting services such as Google Play and the security protections from Google Play Protect will continue to function on existing Huawei devices.

The blow to Huawei added to trade concerns sparked by last Friday's report from CNBC saying the scheduling of the next round of U.S.-China trade talks is "in flux" because it is unclear what the two sides would discuss.

Two sources briefed on the status of trade talks told CNBC discussions regarding scheduling the next round of talks have not taken place since Trump signed an executive order ramping up scrutiny of Chinese telecom companies.

Selling pressure waned shortly after the start of trading, however, with a lack of major U.S. economic data may keeping some traders on the sidelines.

Reports on new and existing home sales and durable goods orders are likely to attract attention in the coming days along with the minutes of the latest Federal Reserve meeting.

Semiconductor stocks have shown a substantial move to the downside in morning trading, dragging the Philadelphia Semiconductor Index down by 2.7 percent to a two-month intraday low.

The weakness in the sector comes after a report from Bloomberg said chipmakers Intel (INTC), Xilinx (XLNX), and Qualcomm (QCOM) told employees they will not supply Huawei until further notice.

Computer hardware and biotechnology stocks are also seeing considerable weakness on the day, while telecom stocks have shown a strong move to the upside.

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Monday. Japan's Nikkei 225 Index edged up by 0.2 percent, while China's Shanghai Composite Index fell by 0.4 percent.

Meanwhile, the major European markets have all moved to the downside on the day. While the U.K'.s FTSE 100 Index is down by 0.4 percent, the French CAC 40 Index and the German DAX Index are down by 1.3 percent and 1.4 percent, respectively.

In the bond market, treasuries have shown a lack of direction over the course of the morning. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is up by less than a basis point at 2.398 percent.

For comments and feedback contact: editorial@rttnews.com

Business News

Follow RTT