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INSTANT VIEW 4-U.S. stocks accelerate lower on trade worries

NEW YORK, March 22 (Reuters) - Major U.S. stock indexes fell as much as 2 percent on Thursday, where they were on track for the steepest drop since a Wall Street rout six weeks ago, gripped by the growing threat of a global trade war.

U.S. President Donald Trump will sign a presidential memorandum on Thursday to potentially slap tariffs on $50 billion in Chinese imports over forced transfer of intellectual property, a senior White House official said.

COMMENTS

KEITH LERNER, CHIEF MARKET STRATEGIST, SUNTRUST ADVISORY SERVICES, ATLANTA

Global growth momentum has shown a bit of softness, specifically in the manufacturing data, the PMI in Europe and Japan that came overnight. You also have some uncertainty around the Fed. It didnt raise the forecast for interest rates for this year, but it did raise it for the (later) years. Theres still some anxiety around what that means for the market. The third thing is trade. The market expects the White House to announce tariffs on China today. The report is around $50 billion. So you take in trade, the Fed, softer economic data, thats the catalyst for todays move.

The bigger picture is that were in a multi-month bottoming process thats very sloppy. The market is looking for a catalyst out there to break to the upside, and theres not an obvious one in the near term." JOHN CAREY, PORTFOLIO MANAGER, AMUNDI PIONEER ASSET MANAGEMENT, BOSTON

Theres too much negative sentiment right now. There are stories about the tech sector, between the disappointing results at Oracle and the Facebook situation, that place in doubt the continued leadership of the so-called FANG stocks. At the same time, you have concerns about tariffs with respect to international trade. Theres too much uncertainty for investors.

At the Fed press conference, the Fed reduced its outlook for the economy somewhat. It changed its description of economic growth to moderate from solid, suggesting that maybe its view of things is a little bit more cautious. Yet it also indicated that it will continue its course of raising rates. Maybe that introduced a little bit of doubt about what the Fed is seeing with economic growth, the potential for accelerated growth.

I think its possible that it will be rough sledding for a while. I dont see anything on the horizon that will reassure people that things are just great. Well have corporate earnings in the next few weeks. If those are better than expected, then its possible that the market will look beyond the uncertainties. MICHAEL OROURKE, CHIEF MARKET STRATEGIST, JONESTRADING, GREENWICH, CONNECTICUT:

There are trade war fears and we're supposed to get (an announcement) on the Chinese tariffs and theres (U.S. Trade Representative Robert) Lighthizer testifying in front of the Senate on trade policy. I don't think that helps. Facebook still has its issues so that's stirring tech. The fact that Mark Zuckerberg said maybe we should be regulated... I'm not sure that will inspire confidence on the part of investors.

"Treasuries are getting a flight-to-quality bid so that's creating a bid in interest-rate sensitive names."

STEFAN WINTNER, VICE PRESIDENT, VOLATILITY STRATEGIES, DUNN CAPITAL MANAGEMENT, STUART, FLORIDA

"From what I see (in the U.S. equity options market), there does not seem to be a lot of panic there yet at least not more than since the Feb 5 crash.

"The Cboe Volatility Index is doing exactly what I would have expected given the size of the move in the S&P 500 Index. The VIX futures market at the moment is a bit subdued. I would say it could have gone up more if there had been panic.

"In the past, we have seen larger moves closer to the end of the session. It appears people wait for an intra-day reversal of the S&P. Towards the end of the day, if we stay down there, in the S&P, where we are now, there could be a pickup in VIX futures activity." PETER COSTA, PRESIDENT, EMPIRE EXECUTIONS, NEW YORK

The market has been extremely sensitive to anything to do with trade. Because in reality, no one wins a trade war, and if there is going to be any kind of escalation of a trade war with China, lets say, were not going to be winners on that and neither are they. The market is a little spooked from that and anytime you hear that, that definitely puts a sour taste in peoples mouths. "(Facebook) definitely is impacting the tech sector and I think that has some bearing on the fact that tech stocks have been down.

Theres a lot of jitters about. Theres not a lot of positives right now to hang onto because earnings season is over and that is generally where you hang your positive feelings. MARKET REACTION STOCKS: The Dow was down 433 points, or 1.75 percent; The S&P 500 was 1.55 percent lower and the Nasdaq was off 1.75 percent. The Dow and Nasdaq briefly fell more than 2 percent in late morning trade. TREASURIES: The yield on the U.S. 10-year Treasury note fell to 2.80 percent, on track for its steepest daily percentage fall since early September. VIX: The Cboe volatility index rose to 21.96 DOLLAR: The U.S. dollar index was up 0.07 percent (Compiled by Alden Bentley)