Stocks crashed from their session highs on Thursday after a senior White House official flatly denied that the Trump administration plans to offer an interim trade deal to China.
The move lower left major US stock indices little changed heading into midday. The Dow Jones Industrial Average, which spiked as much as 150 points, last traded at 27,189.53 for a gain of 52.49 points or 0.19%. The S&P 500 rose 0.27%, while the Nasdaq climbed 0.45%.
Stocks had raced higher during mid-morning trading as Wall Street reacted to a report that the Trump administration could be on the verge of offering Beijing a “limited trade agreement” that would dramatically deescalate US-China tensions as the world’s two largest economies work toward a more robust solution to longstanding divisions on trade and other matters.
Following closely on President Trump’s announcement that he would postpone the imposition of tariff hikes on Chinese goods for two weeks, Bloomberg reported that the White House was mulling a proposal that would delay the new tariffs even longer. Moreover, the report indicated that the administration would consider rolling back certain tariffs that have already gone into effect.
In exchange, unnamed sources said that the White House would ask for China to make a firm commitment to reform its controversial intellectual property policies, as well as increase its purchases of US agricultural goods.
That latter request looked particularly notable, given one of Trump’s tweets on Thursday morning:
“It is expected that China will be buying large amounts of our agricultural products!”
However, Bloomberg’s report earned a sharp rebuttal from an unnamed White House official, who told CNBC that the administration would “absolutely not” offer a limited trade agreement to Beijing.
Payment company stocks rose in unison after French Finance Minister Bruno Le Maire said that France “cannot authorize the development” of Facebook’s Libra cryptocurrency “on European soil.”
PayPal’s 3% advance ranked among the top performers in both the S&P 500 and Nasdaq. Visa led the Dow Jones Industrial Average with a 1.9% increase, while American Express stock gained 1%.
The Dow’s seventh straight advance was weighed down by its most heavily weighted stock, Boeing. BA shares slid 2.2%. The worst performer in the DJIA, Walgreens Boots Alliance, plunged 4.5%.
Other stocks recording substantial losses included Oracle (-5.2%), Kroger (-3.3%), and JB Hunt (-1.5%).
Last modified: September 28, 2020 4:45 AM