NEW YORK (AP) — Global stocks tumbled Thursday as investors’ anxiety over the U.S. trade spat with China increased with the two sides showing no hurry to get back to the negotiating table.
In the U.S., the Dow Jones Industrial Average was down about 300 points. Most sectors in the S&P 500 fell and the index is headed for its third straight weekly loss. Investors sought safety in the bond market and the yield on the 10-year Treasury dropped to 2.33 percent, the lowest level in more than a year.
The market has been highly volatile since the U.S. and China escalated their dispute over trade earlier this month. The two sides have broken off negotiations and appear set for a long standoff. Investors are concerned a prolonged trade war could hurt the U.S. economy and corporate profits.
Trade-sensitive technology stocks again led the losses. Many tech companies do significant business in China and this week face the additional headwind of proposed restrictions on technology sales to Chinese companies by the Trump administration. Apple fell 2% and Microsoft fell 1.4%.
Chipmakers, including Intel, Broadcom and Nvidia, all fell. An S&P index that tracks the performance of makers of chips and chip equipment has plunged about 16% so far this month amid the heightened trade tensions.
Banks also fell broadly in the sell-off. JPMorgan shed 2.1% and Bank of America slid 2.5%.
Energy stocks slid as the price of U.S. oil plunged 5% to $58.34 a barrel and is down 7% for the week. Exxon fell 2% and Chevron slid 2.3%.
Investors fled to safer holdings. Utilities and real estate were the only sectors showing gains. Utilities are considered less of an investment risk and more money gets shifted into those stocks when investors are concerned about volatility and a slowdown in economic growth.
The U.S. and China concluded their 11th round of trade talks earlier this month with no agreement. Instead, the U.S. moved to increase tariffs on Chinese goods, prompting China to reciprocate. The trade dispute escalated further after the U.S. proposed restrictions on technology sales to China, though it has temporarily backed off.
China is looking for ways to retaliate and has reached out for support from Russia and its neighbors in Asia. Both the U.S. and China have made overtures about continuing trade talks, but none are scheduled.
Markets in Asia and Europe also saw steep losses. The DAX in Germany dropped 1.5% while China’s Shanghai index fell 1.4%.
The resumption of trade hostilities interrupted a market rally that saw the S&P 500 hit a record and wipe out the sharp decline from the fourth quarter of last year. The index is down 4.2% so far in May, though it’s still sporting a gain of 12.6% for the year.
KEEPING SCORE: The S&P 500 index fell 1.1% as of 11 a.m. The Dow Jones Industrial Average fell 302 points, or 1.1%, to 25,474. The Nasdaq composite dropped 1.3%.
BRAZIL CALLING: Avon shares soared 6.9% after Brazilian cosmetics maker Natura announced that it is buying the beauty products company for $3.7 billion in stock.
The deal would create the world’s fourth-largest group of beauty products. Natura also currently owns retail stores like The Body Shop.
ENTICING PROFIT: Victoria’s Secret owner L Brands surged 15.7% after blowing away Wall Street’s first quarter earnings forecasts.
The company, which also owns Bath & Body Works, gave investors a surprise profit on better-than-expected revenue.