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Overnight Markets: US falls on protracted trade war fears

Wall Street declined on Thursday, led by energy and technology stocks, prompting mixed trading in Asia with falls in Japan on fears the US-China trade war is escalating.

Overnight Markets: US falls on protracted trade war fears

Wall Street declined on Thursday, led by energy and technology stocks, on fears that the escalating US-China trade war would stymie global economic growth.

The Dow Jones Industrial Average fell 286 points, or 1.11%, to 25,490, the S&P 500 lost 34 points, or 1.19%, to 2,822 and the Nasdaq Composite dropped 123 points, or 1.58%, to 7,628.

Beijing said that Washington needs to correct its “wrong actions” for trade talks to continue after the US blacklisted Huawei Technology Co Ltd last week. The statement furthered fuelled trade fears among investors.

Among S&P 500 sectors, only utilities and real estate, both considered defensive areas, registered gains as investors moved to safe-haven assets such as Treasuries. Technology and industrial companies fell 1.7% and 1.6%, respectively. Shares of S&P 500 companies in the cyclical financial and energy sectors also tumbled, with the 3.1% drop in energy stocks in response to slump in oil prices.

Adding to the downbeat mood in markets, data from IHS Markit showed US manufacturing faltered in May, with new orders falling for the first time since August 2009.

The Commerce Department said new-home sales declined 6.9% to a seasonally adjusted annual rate of 673,000 in April - in line with forecasts.

Among individual stocks, NetApp Inc tumbled 8.1%, the biggest percentage drop on the S&P 500, after the data storage equipment maker forecast current-quarter profit and revenue below Wall Street estimates.

L Brands Inc shares jumped 12.8% after the owner of Victoria’s Secret and Bath & Body Works reported better-than-expected quarterly earnings.

Shares of Dow component Apple Inc. slid 1.7% after UBS cut its price target on the stock from $235 to $225, following the release of its annual survey of smartphone users.

Shares of Best Buy Co. slumped 4.8% after the big-box retailer reported first-quarter earnings that beat Wall Street forecasts, but issued a subdued outlook for the full-year 2019.

In Asia, share markets were mixed in early trade on Friday as investors remained worried over trade tensions between the US and China.

Mainland Chinese shares rose in early trade, with the Shanghai composite gaining 0.62%, and the Shenzhen composite edging up 0.19%. Hong Kong’s Hang Seng index was up 0.40%.

In Japan, the benchmark Nikkei 225 pared some losses from earlier, falling 0.57%. South Korea’s Kospi was down 0.59%. Australia’s ASX 200 was lower by 0.67%.

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