US stocks fall, ending three-day winning streak

An Aug 19, 2019 photo shows traders working on the floor of the New York Stock Exchange. PHOTO: AFP

NEW YORK (AFP) - Wall Street stocks fell on Tuesday (Aug 20), snapping a three-session winning streak amid lingering unease over global growth and the US-China trade war.

Stocks were in the red most of the day, but slid further after US President Donald Trump once again said he was not ready to reach a trade deal with China.

Analysts also cited a drop in the yield on the 10-year US Treasury note, which is seen as a proxy for confidence in medium-term economic growth.

The Dow Jones Industrial Average lost 0.7 per cent to end at 25,962.44.

The broad-based S&P 500 slid 0.8 per cent to close at 2,900.51, while the tech-rich Nasdaq Composite Index shed 0.7 per cent to 7,948.56.

Stocks ended near session lows, but analysts have said low trading volumes in August can exacerbate market moves.

Quincy Krosby, chief market strategist for Prudential Financial, said the pullback was unsurprising after US stocks gained more than one percent on Monday.

She said investors were concerned about the Federal Reserve release on Wednesday of the minutes from the July 30-31 policy meeting when the US central bank cut the benchmark interest rate but Fed chairman Jerome Powell offered confusing signals about whether to expect additional rate cuts in 2019.

"The market clearly is pricing in a 25 point cut at the next Fed meeting," Krosby said.

"I wouldn't put that much on tomorrow's minutes, but in a market that is concerned about growth and trade, the effective trend on corporate spending and ultimately hiring, any information that the market doesn't have now will be important."

Among individual companies, Home Depot jumped 4.4 per cent after it reported better-than-expected second-quarter profits. But the home-improvement retailer lowered its full-year sales estimate due to lower lumber prices as well as the potential hit to consumers from a new round of US tariffs on Chinese goods.

Kohl's, another retailer, sank 6.9 per cent as it reported a 2.9 per cent drop in comparable sales in the second quarter.

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