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Author Topic: Stocks open lower, Dow inches close to correction territory  (Read 159 times)

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Stocks open lower, Dow inches close to correction territory

Stocks opened lower on Thursday as Wall Street added to weekly losses amid rising tensions between the United States and some of its key trade partners.

The Dow Jones Industrial Average fell 30 points at the open, with Walgreens Boots Alliance as the worst-performing stock in the index. The 30-stock index also inched closer to re-entering correction territory, trading 9.5 percent below its 52-week high.

The S&P 500 traded just below breakeven as health care pulled back half a percent. The Nasdaq composite slipped 0.1 percent.

Stocks followed German equities lower, as the DAX index pulled back 1.4 percent after the release of stronger-than-expected inflation data. That decline sent European stocks down broadly, with the Stoxx 600 index pulling back 1 percent.

Equities have been under pressure this week as trade tensions between the U.S. and some of its biggest trade partners have mounted. Through Wednesday's close, the Dow is down 1.9 percent for the week, while the S&P 500 and Nasdaq composite are down 2 percent and 3.2 percent, respectively.



Getty Images
Traders work on the floor of the New York Stock Exchange (NYSE) on February 5, 2018 in New York City.

“Although through most of this month the US equity market appeared to be used as a destination for capital, suggesting that rotation was the primary influence, recent sessions have suggested that liquidation has become the order of the day,” said Michael Shaoul, chairman and CEO of Marketfield Asset Management.

Behind all of this “is the confusion and concern generated by the threat of tariff, trade and investment restrictions being imposed on a variety of sectors,” said Shaoul in a note.

On Wednesday, a Trump administration official stated that the government would rely on the U.S. Committee on Foreign Investment to take care of matters concerning foreign purchase of domestic technologies that are deemed sensitive.

Not only is the U.S. in a tit-for-tat war of words with China on tariffs, but now the European Union is involved after President Donald Trump took to Twitter last week to threaten a 20 percent tariff on all car imports from the bloc.

“As long as we’re dealing with trade policies, volatility will remain at the forefront of markets,” said Paul Townsen, managing director at Crossmark Global Investments.

Walgreens Boots Alliance and CVS Health dropped 9.5 percent and 9.4 percent, respectively, after Amazon announced it had bought PillPack, an online pharmacy.


Ref. www.cnbc.com/2018/06/28/us-stock-futures-trade-uncertainty-and-economic-data-in-focus.html

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