Wall Street sinks amid U.S.-China tensions

Daniel Fowler
July 26, 2020

China ordered the closure of a US consulate in Chengdu, retaliating after Washington shut the Chinese consulate in Houston earlier this week.

The Dow was down 0.1% for the week, and the NASDAQ entered Friday's session down 0.4%, while the S&P 500 was up 0.3% in that time.

Slumping stocks across most of Wall Street sent the Standard & Poor's 500 index to its worst loss in almost four weeks Thursday, undercut by a report showing layoffs are picking up across the country along with coronavirus counts.

Investors remained cautious amid a continued spike in coronavirus infections in the United States and they were also anxious about U.S.

Apple fell 2.6%, and Microsoft lost 2.2%, and tech stocks as a group accounted for about two thirds of the S&P 500's loss.

Microsoft, Apple, Amazon and other giants have cruised through much of the pandemic on expectations that they can keep growing despite all the challenges for the economy.

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Indexes down: Dow 0.42%, S&P 0.45%, Nasdaq 0.69%. All the uncertainty helped gold rise to a record closing high of nearly $1,900 an ounce, beating the all-time high it set in 2011.

At 11:22 a.m. ET, the Dow Jones Industrial Average was down 112.61 points, or 0.42%, at 26,539.72 and the S&P 500 was down 14.53 points, or 0.45%, at 3,221.13. Investor confidence has been shaken by the uptick in tensions, especially as key allies of the USA have also started to embrace its harder-edged approach to China. But critics said enthusiasm for them was overdone, with prices too high even after accounting for the huge profits that they can produce.

Despite all those challenges, the S&P 500 remains only about 5 percent below its record set in February, after roaring back from an earlier, almost 34 percent plummet. Intel Corp led the sell-off, with its shares plunging 15.7 per cent after the chipmaker reported a delay in production of a smaller, faster 7-nonometer chip.

Overseas, the pan-continental Stoxx Europe 600 dropped 1.6%. Facebook and Netflix are on track to fall 5.8% and about 4.3% this week, respectively, underperforming the broader market. It tends to move with investors' expectations for the economy and inflation.

Gold rose 0.6% to $1,902.00 per ounce, crossing above that threshold for the first time in almost nine years.

Gold for delivery in August rose $24.90 to $1,890.00 an ounce. Brent crude oil for September delivery fell 98 cents to $43.31 a barrel.

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