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Stocks Fall on Trump’s Tariff Gambit, Factory Data: Markets Wrap

Rita Nazareth and Vildana Hajric
Stocks Fall on Trump’s Tariff Gambit, Factory Data: Markets Wrap

(Bloomberg) -- U.S. stocks dropped on concern over global trade risks and disappointing factory data. The dollar and bonds declined.

The S&P 500 Index fell the most in almost eight weeks on concern the U.S. will slap fresh tariffs on China and after President Donald Trump reinstated levies on steel and aluminum from Argentina and Brazil. The risk-off mood spread to Europe, where shares had the biggest slump in two months. The greenback slid against most major peers, while Treasury 10-year yields jumped.

The latest developments on trade overshadowed hope that the world’s two largest economies were close to signing the first part of a trade deal. Meantime, an unexpected decline in U.S. manufacturing showed the sector lacked momentum in an environment of corporate investment cutbacks, subdued global demand and a still-simmering trade war.

“It’s all part of the same narrative, right?” Tom Porcelli, chief U.S. economist at RBC Capital Markets, told Bloomberg TV. “There’s a narrative problem in the manufacturing space and the narrative problem obviously stems from trade. Until you actually can sign this deal, I think that manufacturing will remain under pressure.”

Read: A $25 Trillion Rally Was Built on GDP Growth No Better Than This

The American manufacturing miss countered signs of recovery in China and Europe. It also revived concern about the U.S. economy and could reignite bets on further Federal Reserve easing, according to Eimear Daly, a currency strategist at Macquarie Bank. Earlier Monday, Trump again called on the Fed to loosen monetary policy.

Traders also monitored the latest on retail after Black Friday hit a record $7.4 billion in U.S. online sales. American shoppers are on track to spend an estimated $9.4 billion on Cyber Monday -- a record -- boosting an already robust holiday shopping season. Yet a gauge of retailers in the S&P 500 dropped on Monday, joining broader market losses.

More on corporate news:

Roku Inc. sank after Morgan Stanley cut its rating and warned that revenue and gross profit growth may “slow meaningfully” next year.Apache Corp. tumbled after the company’s update on an exploratory oil well off the coast of Suriname offered little indication as to whether it will be commercially viable.Biogen Inc. slumped after being downgraded at Robert W. Baird, which warned investors ahead of a company presentation at a medical meeting later this week.

Elsewhere, oil rebounded from the biggest weekly loss since October on speculation OPEC+ could defy expectations by deepening production cuts.

Here are some key events coming up this week:

Saudi Aramco’s initial public offering is scheduled to be priced on Thursday.Friday brings the U.S. jobs report, where estimates are for non-farm payrolls to rise by 190,000 in November.

These are the main moves in markets:

Stocks

The S&P 500 fell 0.9% to 3,113.87 at 4 p.m. New York time.The Stoxx Europe 600 Index sank 1.6%.The MSCI Asia Pacific Index jumped 0.7%.

Currencies

The Bloomberg Dollar Spot Index slid 0.3%.The euro rose 0.6% to $1.1081.The Japanese yen added 0.5% to 108.97 per dollar.

Bonds

The yield on 10-year Treasuries rose four basis points to 1.82%.Germany’s 10-year yield jumped eight basis points to -0.28%.Britain’s 10-year yield rose climbed basis points to 0.739%.

Commodities

The Bloomberg Commodity Index was little changed.West Texas Intermediate crude rose 1.4% to $55.96 a barrel.Gold decreased 0.3% to $1,468.60 an ounce.

--With assistance from Adam Haigh, Yakob Peterseil, Sam Potter and Sarah Ponczek.

To contact the reporters on this story: Rita Nazareth in New York at rnazareth@bloomberg.net;Vildana Hajric in New York at vhajric1@bloomberg.net

To contact the editors responsible for this story: Jeremy Herron at jherron8@bloomberg.net, Rita Nazareth

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