Stocks plunge as China hits U.S. goods with tariffs

USA stocks tumbled into correction mode to start off the second quarter on Monday, as technology shares got battered on worries sparked by trade concerns and tweets by President Trump and Elon Musk.

Stocks closed sharply lower on Wall Street as technology companies took heavy losses and investors anxious about escalating trade tensions with China. Wall Street's main indexes were higher today, with the Dow Jones Industrial Average rising more than 100 points, helped by a recovery in the battered technology and consumer discretionary stocks.

The S&P 500 rose 0.37 per cent to 2,591.43 and the Nasdaq Composite gained 0.57 per cent to 6,909.08.

Facebook stock also continued to fall Monday (2.75 percent) as the social network faces scrutiny over its sale and collection of user data. The Nasdaq Composite was off by 3.4 percent before recovering to end down 2.74 percent. The blue chip Dow Jones Industrial Average closed at 24103.11, up 2.4%. Seoul's Kospi retreated 0.6 percent to 2,429.18. There are a number of points of contention between China and Washington, Europe and Japan over a state-led economic model they complain hampers market access, protects Chinese companies and subsidizes exports in violation of Beijing's free-trade commitments.

Investors will also be watching the testimony of Facebook leader Mark Zuckerberg before Congress on Tuesday and the possibility of further attacks against Amazon by President Trump through his Twitter account.

Brent crude, used to price global oils, rose 16 cents to $67.80 in London.

Trump once again accused Amazon of taking advantage of the US Postal Service. Technology companies including Oracle, Apple and Google parent Alphabet moved higher even though they weren't doing as well as the rest of the market. Tesla fell more than 5% on production concerns.

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Volatility was the theme in the USA equity markets during the holiday-shortened week. Trump has also proposed tariffs on a wider range of about US$60 billion worth of Chinese goods that China has yet to respond to beyond promising it will defend itself.

Wall Street rebounded following Monday's selloff as investors found value in beaten-down stocks.

Tesla (TSLA) came under regulatory scrutiny after a second crash this year involving the electric auto company's Autopilot driver-assistance system, the latest of which involved a death.

U.S. Treasury yields fell to two-month lows as investors fled sliding stocks for safety ahead of Friday's closely watched jobs report. Coca-Cola climbed 1.8 per cent and Johnson & Johnson added 2 per cent.

U.S. WTI crude oil +0.7% at $63.46/bbl.

The dollar rose to 106.61 yen from 105.85 yen. Brent crude, used to price worldwide oils, slid $1.52, or 2.2 percent, to $67.82 a barrel in London. The euro fell to $1.2267 from $1.2300. The Hang Seng in Hong Kong was closed as well.

  • Rita Burton