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Bloomberg
US stocks fell after Caterpillar and Nvidia blamed slowing global growth for disappointing results, adding to concern the trade war with China is hitting corporate profits. The dollar edged higher.
The S&P 500 began a crucial week for trade and monetary policy sharply lower as the sector bellwethers doused enthusiasm over the young earnings season. The Dow Jones Industrial Average sank almost 400 points, with all 30 members in the red. The equipment maker sank 8.5 percent after pinning its biggest quarterly profit miss in a decade on weak demand from China. The chipmaker plunged 17 percent after slashing its revenue forecast. AMD, Micron and Lam Research lost at least 3.5 percent.
The disappointing results come ahead of a busy week for American corporate reports, highlighted by Microsoft, Apple and 10 other Dow components. Investors will also grapple with trade negotiations, a Federal Reserve policy decision and there will be another series of potentially key votes in the UK Parliament about Brexit. To cap it all, a flurry of American economic figures including GDP and jobs data are also set for release.
European equities fell, though miners bucked the decline as iron ore jumped following a deadly dam collapse at a mine in Brazil. Earlier in Asia, Japanese and Chinese shares retreated, while stocks in Hong Kong pared gains to close little changed. The yuan appreciated to its strongest against the dollar since July before Vice Premier Liu He travels to Washington for trade talks, and as the People’s Bank of China freed
up a potential $37 billion for bank lending.
Elsewhere, Bitcoin fell, putting the biggest cryptocurrency on track for its lowest close since December. Emerging-market stocks slipped while their currencies climbed.
Gold retreated, and Venezuela bonds extended their rally. Russia’s MOEX stock index touched an intraday record high after sanctions were lifted on Rusal, before reversing gains as oil prices slumped.
Chinese President Xi’s top economic aide, Vice Premier Liu He, will meet with US
Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin on Wednesday and on Thursday. Tech giants Apple, Microsoft, Facebook, Alibaba, SAP, Qualcomm, Tesla, Samsung and Sony announce earnings. On Tuesday the UK Parliament votes on amendments to Theresa May’s Brexit deal with the EU. The EU Parliament debates Brexit on Wednesday. Fed Chairman Jerome Powell will hold a news conference after the FOMC rate decision on Wednesday.
The S&P 500 Index fell 1.3 percent in New York. The Nasdaq 100 Index lost 2 percent. The Stoxx Europe 600 Index declined 0.4 percent, the biggest drop in two weeks.
The MSCI Asia Pacific Index decreased 0.2 percent. The MSCI Emerging Market Index dipped 0.3 percent.
The Bloomberg Dollar Spot Index climbed 0.1 percent. The euro increased 0.1 percent to $1.142, the strongest in two weeks. The British pound declined 0.3 percent to $1.3152, the largest fall in more than a week. The Japanese yen gained 0.1 percent to 109.41 per dollar.
The yield on 10-year Treasuries decreased one basis point to 2.75 percent. Germany’s 10-year yield gained three basis points to 0.22 percent. Britain’s 10-year yield increased one basis point to 1.317 percent.
West Texas Intermediate oil futures fell 1.7 percent to $52.78 a barrel. Gold dropped 0.4 percent to $1,299.88 an ounce.