(Reuters) – Wall Street fell more than 1% and the benchmark S&P 500 hit a near one-month low on Tuesday, as comments from President Donald Trump and Commerce Secretary Wilbur Ross stoked fears of a significant delay in resolving a trade dispute with China.
FILE PHOTO: Traders work on the floor at the New York Stock Exchange (NYSE) in New York, U.S., November 27, 2019. REUTERS/Brendan McDermid
Speaking to reporters in London where Trump was attending a meeting of NATO leaders, he raised the possibility of the trade deal being delayed until after the U.S. presidential elections in November 2020.
Ross told CNBC that planned tariffs on Chinese imports will be imposed on Dec. 15 unless there is some real reason to postpone, such as substantive progress in talks.
The trade-sensitive Philadelphia Semiconductor index .SOX dropped 2.4% to hit an over one-month low.
Tuesday’s declines added to the pullback in the previous session, from record highs hit last week, on hopes that the two sides will hammer out a “phase one” deal soon, and signaled a rough start to the month.
“This is sort of a last-minute negotiation tactic,” said Robert Pavlik, chief investment strategist and senior portfolio manager at SlateStone Wealth LLC in New York.
“If the Dec. 15 tariffs go into effect, then I think people start thinking that this could have additional ramifications on a ‘phase-one’ ever getting done.”
The S&P 500 is still up about 23% this year, helped by interest rate cuts from the Federal Reserve, even as conflicting headlines on trade have caused some volatility.
At 11:31 a.m. ET, the Dow Jones Industrial Average .DJI was down 438.25 points, or 1.58%, at 27,344.79, the S&P 500 .SPX was down 36.21 points, or 1.16%, at 3,077.66 and the Nasdaq Composite .IXIC was down 106.03 points, or 1.24%, at 8,461.96.
Declining issues outnumbered advancers for a 2.45-to-1 ratio on the NYSE and a 2.34-to-1 ratio on the Nasdaq.
The S&P index recorded one new 52-week high and four new lows, while the Nasdaq recorded 17 new highs and 53 new lows.
Reporting by Arjun Panchadar and Ambar Warrick in Bengaluru; Editing by Arun Koyyur and Shounak Dasgupta