Apple, Amazon lead Wall Street lower as tariffs loom

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Apple, Amazon lead Wall Street lower as tariffs loom

Shreyashi Sanyal

(Reuters) – A slide in Apple and Amazon led the S&P 500 and Nasdaq indexes lower on Monday on expectations that President Donald Trump was about to go ahead with new tariffs on $200 billion of Chinese goods and that Beijing would retaliate.

A July list of products to be covered by the new tariffs included a range of internet technology products, printed circuit boards and other electronics, putting the focus on the impact on big U.S. tech players.

The final list of products to be covered was not clear, but the technology sector .SPLRCT dropped 0.8 percent as Apple (AAPL.O), which has said the moves could hit a “wide range” of its products, slid 1.8 percent.

Chipmaker Advanced Micro Devices (AMD.O) was the second most traded stock, down 0.3 percent, and while falls in both the S&P and Dow were minimal, the tech-heavy Nasdaq dropped almost 1 percent.

“The only index under severe pressure right now is the Nasdaq and it is obvious that some of the big technology names could be lower on concerns around these potential tariffs,” said Peter Cardillo, chief market economist at Spartan Capital Securities in New York.

Another area set to be hit by the costs of the tariffs, the consumer discretionary sector .SPLRCD, fell 0.76 percent, the most among the 11 major S&P sectors. Shares in Netflix (NFLX.O) and Amazon (AMZN.O) both fell 2.3 percent.

Retailers including Macy’s (M.N) and Kohl’s (KSS.N) also dropped, and the S&P 500 retailers index .SPXRT lost 1.4 percent.

A climb in oil prices on supply concerns ahead of U.S. sanctions on Iran that take effect in November helped shares in major producers. Chevron (CVX.N) and Exxon (XOM.N) both rose about 0.7 percent, boosting the Dow Industrials and pulling the energy sector index higher .SPNY.

By 11:35 a.m. ET the Dow Jones Industrial Average .DJI was down 10.34 points, or 0.04 percent, at 26,144.33, the S&P 500 .SPX was down 7.54 points, or 0.26 percent, at 2,897.44 and the Nasdaq Composite .IXIC was down 69.72 points, or 0.87 percent, at 7,940.33.

Five of the 11 major S&P 500 sectors were lower. The CBOE Volatility index .VIX, known as Wall Street’s fear gauge, rose 0.66 points, its first increase in six sessions.

Twitter (TWTR.N) fell 4.3 percent, the most on the S&P, after brokerage MoffettNathanson flagged concerns over rising expenses.

Defying the weakness in chipmakers was Broadcom (AVGO.O), which rose 0.6 percent after brokerage Nomura raised its rating on expectations of a higher dividend.

Declining issues outnumbered advancers for a 1.05-to-1 ratio on the NYSE and a 1.53-to-1 ratio on the Nasdaq.

The S&P index recorded 30 new 52-week highs and no new lows, while the Nasdaq recorded 41 new highs and 44 new lows.