Industrials Slip Further as Trade Tensions Pressure Stocks

The trading floor at the New York Stock Exchange (NYSE), Wednesday. (Reuters/Andrew Kelly)

U.S. stocks are mostly lower as investors’ fears about tariffs and decreased international trade continue to hurt industrial companies. Banks are also falling as bond yields decline, but technology companies are making gains. Department stores and other retailers are losing ground after the Commerce Department said retail sales declined in February.

KEEPING SCORE: The S&P 500 index fell 6 points, or 0.3 percent, to 2,758 as of 2:05 p.m. Eastern time. The Dow Jones industrial average fell 141 points, or 0.6 percent, to 24,865. Earlier it lost as much as 338 points. The Dow is comprised of 30 large multinational companies and has been hit hard by concerns about tariffs this month. The Nasdaq composite rose 12 points, or 0.2 percent, to 7,523. The Russell 2000 index of smaller-company stocks declined 2 points, or 0.1 percent, to 1,590.

TRADE TROUBLES: Investors remained focused on the potential for new trade actions from President Donald Trump and leaders in Europe warned about the risks of trade disputes. European Union head Donald Tusk urged Pres. Trump to pursue more cooperation with Europe instead of putting tariffs on European goods.

The EU wants an exemption from the tariffs on aluminum and steel imports that Pres. Trump recently announced and has said it could retaliate with tariffs of its own. Meanwhile German Chancellor Angela Merkel said she can’t predict if those talks will succeed.

At the beginning of the month, stocks slumped after Pres. Trump announced his tariff plans. They recovered somewhat after the administration said it would grant exemptions to some countries, but over the last two days Aerospace and defense giant Boeing slid $5.65, or 1.7 percent, to $333.02, and it’s down 6 percent this week. Arconic, which uses a lot of aluminum in the products it makes for aerospace companies, fell 79 cents, or 3.2 percent, to $24.16. Defense contractors including Raytheon and Lockheed Martin also declined, as did airlines.

European stocks fell as well. France’s CAC 40 gave up 0.2 percent and the British FTSE 100 lost 0.1 percent. Germany’s DAX added 0.1 percent.

BONDS: Bond prices climbed, sending yields lower. The yield on the 10-year Treasury note fell to 2.82 percent from 2.84 percent, a significant move. That helped send bank stocks lower. Declining yields force interest rates on loans like mortgages lower, which hurts banks’ profits. Citigroup fell 97 cents, or 1.3 percent, to $73.94 and Bank of New York Mellon decreased 80 cents, or 1.4 percent, to $55.16.

TECH REBOUNDS: Technology companies regained some of their losses from a day ago. Alphabet, Google’s parent company, picked up $16.66, or 1.5 percent, to $1,156.57 while payment services company PayPal jumped $2.91, or 3.6 percent, to $83.11.

ECONOMIC INDICATORS: Retail sales dipped 0.1 percent last month as car sales declined, and so did purchases at gas stations and department stores. Kohl’s slid $1.65, or 2.6 percent, to $62.46 and Macy’s fell 33 cents, or 1.1 percent, to $29.12. Discount retailer Dollar Tree fell $1.28, or 1.4 percent, to $93.14.

The Commerce Department said shoppers spent more money online and at catalog retailers, and Amazon edged higher. Spending at restaurants, clothiers and building materials stores also increased.

Meanwhile the Labor Department said wholesale prices rose 0.2 percent in February, a similar pace as the last few months. The agency said prices for services including transportation and warehousing increased. It’s the latest sign that inflation remains in check.

SIGNET TARNISHED: Signet Jewelers plunged after the jewelry retailer gave profit and sales forecasts that were weaker than analysts expected. Signet also said it intends to cut at least $200 million in spending and will sell its non-prime credit receivables. It will take a loss of about $170 million on that sale. The stock dropped $9.08, or 19 percent, to $38.83.

CHECK ENGINE LIGHT: Tesla declined after Bloomberg News reported that a second senior finance executive resigned. Bloomberg said Treasurer Susan Repo left to become chief financial officer at another company. A week ago the electric car maker said Chief Accounting Officer Eric Branderiz left “for personal reasons.” Tesla stock slipped $8.43, or 2.5 percent, to $333.41.

ENERGY: Benchmark U.S. crude fell 2 cents to $60.69 a barrel in New York. Brent crude, used to price international oils, rose 1 cent to $64.65 per barrel in London.

METALS: Gold slipped $1.50 to $1,325.60 an ounce. Silver fell 9 cents to $16.54 an ounce. Copper rose 2 cents to $3.16 a pound.

CURRENCIES: The dollar fell to 106.33 yen from 106.61 yen. The euro slipped to $1.2376 from $1.2397.

ASIA: Japan’s benchmark Nikkei 225 lost 0.9 percent while South Korea’s Kospi fell 0.3 percent. Hong Kong’s Hang Seng dropped 0.5 percent.