North American stocks had been higher for most of the session as investors continued to bet on a swift recovery from economic slump
Wall Street ended lower on Thursday following a late-session reversal, with Facebook weighing on the market after President Donald Trump said he would sign an executive order related to social media companies and said he would hold a news conference on China on Friday. The TSX finished just slightly in the red, also surrendering earlier gains.
North American stocks had been higher for most of the session as investors continued to bet on a swift recovery from the coronavirus-driven economic slump.
Worsening ties between the United States and China in recent weeks and fears of a second wave of coronavirus infections pose a threat to the stock market’s strong recovery from its steep selloff, according to analysts.
There have been issues with comments from the White House on tech, said Quincy Krosby, chief market strategist at Prudential Financial in Newark, New Jersey.
But recent strong gains in the market have also caused some investors to pull back.
Unofficially, the Dow Jones Industrial Average fell 147.67 points, or 0.58%, to 25,400.6, the S&P 500 lost 6.41 points, or 0.21%, to 3,029.72, and the Nasdaq Composite dropped 43.37 points, or 0.46%, to 9,368.99.
The S&P/TSX Composite Index closed down 0.23 of a point at 15,271.80. The financials index lost 1.48%, as TD and CIBC reported results that once again highlighted the surge in loan loss provisions by the major banks.
Shares of Twitter Inc ended down 4.4% and Facebook Inc fell 1.6% following news of the executive order. The White House, after the market close, said Trump had signed the order, which removes a liability shield they currently enjoy.
Trump said he was directing Attorney General William Barr to work with states to enforce their own laws against what he described as deceptive business practices by social media companies.
Concerns about China-U.S. relations may also have driven the late decline. White House economic adviser Larry Kudlow told CNBC on Thursday that Hong Kong may now be needed to be treated like China when it comes to trade and other matters, echoing remarks by Secretary of State Mike Pompeo on Wednesday.
We are concerned (it’s) saber rattling with China… It was just a big selloff because of that, said Tim Ghriskey, chief investment strategist at Inverness Counsel in New York, New York.
Stocks had been higher for most of the session as investors continued to bet on a swift recovery from the coronavirus-driven economic slump.
Worsening ties in recent weeks between the United States and China, the world’s two largest economies, could pose a threat to the stock market’s strong recovery from its steep selloff.
The S&P 500 is still up sharply from the low hit in March as a restart in business activity after weeks of shutdown and massive amounts of stimulus measures to support the economy have driven hopes of a strong recovery.
