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U.S. Stocks Close Mostly Lower Amid Lingering Trade Concerns

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Stocks fluctuated over the course of the trading day on Monday but maintained a negative bias throughout the session. The major averages all finished the day lower, although the tech-heavy Nasdaq underperformed its counterparts by a wide margin.

While stocks climbed off their worst levels going into the close, the major averages remained stuck in the red. The Nasdaq plunged 113.91 points or 1.5 percent to 7,702.38, while the Dow fell 84.10 points or 0.3 percent to 25,679.90 and the S&P 500 slid 19.30 points or 0.7 percent to 2,840.23.

Tech stocks led the way lower on Wall Street 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.

Trading activity was somewhat subdued, 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.

Sector News

Semiconductor stocks turned in some of the market's worst performances on the day, dragging the Philadelphia Semiconductor Index down by 4 percent to its lowest closing level in well over two months.

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.

Significant weakness was also visible among computer hardware stocks, as reflected by the 2.2 percent slump by the NYSE Arca Computer Hardware Index.

Commercial real estate, chemical, and software stocks are also saw considerable weakness, while telecom stocks saw some strength on the day.

Other Markets

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 all moved to the downside on the day. While the U.K'.s FTSE 100 Index slid by 0.5 percent, the French CAC 40 Index and the German DAX Index tumbled by 1.5 percent and 1.6 percent, respectively.

In the bond market, treasuries have moved moderately lower over the course of the session. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, rose by 2.3 basis points to 2.416 percent.

Looking Ahead

Any news on the trade front is likely to remain in the spotlight on Tuesday, potentially overshadowing a report on existing home sales in the month of April.

On the earnings front, Home Depot (HD) and J.C. Penney (JCP) are among the companies scheduled to release their quarterly results before the start of Tuesday's trading.

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