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US: Nasdaq ends at record high, Dow falls on trade war worries
[NEW YORK] The Nasdaq finished at another record high on Monday, but the Dow tumbled as revived worries of a trade war led to heavy selling in shares of several leading multinationals.
The tech-rich Nasdaq Composite Index rose 0.4 per cent to 7,588.32, its second straight record.
The Dow Jones Industrial Average dropped 0.6 per cent to 25,178.61, while the broad-based S&P 500 shed 0.1 per cent to 2,783.02.
Wall Street stocks opened well on continued positive momentum from last Friday's strong jobs report, but the tone quickly shifted as investors took note of sharpening rhetoric on international trade.
European Trade Commissioner Cecilia Malmstroem said the trading bloc would "stand up to bullies" after President Donald Trump threatened to tax German cars if the European Union doesn't lower barriers to US products.
Mr Trump provoked the Europeans still further in a tweet saying his Commerce Secretary Wilbur Ross would speak with the EU side "about eliminating the large tariffs and barriers they use against the U.S.A."
Art Hogan, chief market strategist at Wunderlich Securities, said the back and forth reignited worries about a trade war that had receded somewhat after Mr Trump indicated more flexibility on imported steel and aluminum.
"Now, when we start to hear about possible retaliation, it becomes a concern again," Mr Hogan said.
Boeing and Caterpillar both dropped more than two per cent, while United Technologies shed 1.9 per cent and Honeywell International 1.3 per cent. All are major exporters that could be hurt if escalating threats become reality.
Among Nasdaq companies, both Apple and Amazon gained around one percent, while Tesla Motors jumped 5.6 per cent.
But Netflix dropped 3.1 per cent after Citron Research said the streaming company was overvalued and should be "shorted," meaning investors should bet it will fall.
Broadcom shares jumped 3.6 per cent after a Wall Street Journal report that Intel is considering bidding for the chip company, which has undertaken a hostile campaign to buy Qualcomm. Intel fell 1.3 per cent.
Goldman Sachs gained 1.0 per cent after announcing that co-president Harvey Schwartz would retire, leaving David Solomon the sole president and next in line to become the investment bank's next chief executive.