US Markets

Wall Street down as global growth worries hit tech stocks

Credit: REUTERS/Eduardo Munoz

U.S. stocks fell in morning trading on Tuesday as weak economic data from China added to fears of a global recession and pushed investors out of riskier technology stocks.

By Uday Sampath Kumar

Sept 10 (Reuters) - U.S. stocks fell in morning trading on Tuesday as weak economic data from China added to fears of a global recession and pushed investors out of riskier technology stocks.

China's factory-gate prices shrank 0.8% in August, the sharpest pace of decline in three years, as businesses slashed prices to cope with flagging demand amid a bruising trade war with the United States that has slowed growth in the world's second largest economy.

Microsoft Corp MSFT.O was the biggest drag on the S&P 500 for the second straight session. Losses in Visa Inc V.N and Mastercard Inc MA.N pulled the tech sector .SPLRCT 1.51% lower. Healthcare stocks .SPXHC were down 1.26%.

Bank stocks .SPXBK were the top boost to the financial sector, rising 1.06%, while energy stocks jumped 1.53%. U.S. Treasury yields US2YT=RR, US10YT=RR climbed to fresh three-week peaks. US/

Trading so far this week has largely been subdued as investors hold out for policy decisions from central banks on potential monetary easing.

The U.S. Federal Reserve and the European Central Bank (ECB) are widely expected to cut interest rates over the next two weeks, but investors doubt the extent to which central banks' measures will stem an economic slowdown.

"Expectations may be in front of themselves about the amount of new monetary policy stimulus that the ECB is going to move forward with," said Art Hogan, chief market strategist at National Securities in New York.

However, a prolonged U.S.-China trade war could dull the effect of potential rate cuts on economic growth, Hogan said.

Among other stocks, Ford Motor Co F.N fell 3.4% after ratings agency Moody's downgraded its bonds to junk status overnight.

Separately, the U.S. House Judiciary Committee laid out plans to hold hearings into the Justice Department's decision to open an antitrust investigation into Ford and three other automakers.

The FAANG set of stocks were also trading lower, with Apple Inc AAPL.O dipping 0.4% ahead of an event where it is widely expected to unveil its latest iPhones.

Details on its new video streaming service could also move shares of Netflix Inc NFLX.O and Walt Disney Co DIS.N. Netflix was down 0.2%.

At 10:12 a.m. ET the Dow Jones Industrial Average .DJI was down 102.43 points, or 0.38%, at 26,733.08, the S&P 500 .SPX was down 20.68 points, or 0.69%, at 2,957.75 and the Nasdaq Composite .IXIC was down 77.30 points, or 0.96%, at 8,010.14.

Later in the day, Boeing Co BA.N is set to report monthly aircraft deliveries, which will give investors a deeper look into the effect of the grounding of 737 MAX jets. Shares of the planemaker rose 1.5%.

Advancing issues outnumbered decliners by a 1-to-1 ratio on the NYSE. Declining issues outnumbered advancers for a 1.11-to-1 ratio on the Nasdaq.

The S&P index recorded eight new 52-week highs and two new lows, while the Nasdaq recorded 15 new highs and 26 new lows.

(Reporting by Uday Sampath in Bengaluru; Editing by Saumyadeb Chakrabarty and Arun Koyyur)

((UdaySampath.Kumar@thomsonreuters.com; within U.S.+1 646 223 8780; Twitter: @sampath_uday; Reuters Messaging: UdaySampath.Kumar.thomsonreuters.com@reuters.net))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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