Spencer Platt | Getty Images News | Getty Images
A trader on the floor of the New York Stock Exchange the morning after the Dow Jones Industrial Average dropped over 1,000 points on Feb. 9, 2018.
The major indexes traded lower earlier in the day as Wall Street fretted over global trade. China will seek to authorization from the World Trade Organization to slap sanctions on the United States as trade tensions between the two largest world economies grow.
Last Friday, President Donald Trump said he was “ready to go” on hitting China with an additional $267 billion worth of tariffs. The U.S. administration had already previously announced that it would impose tariffs on $200 billion in Chinese goods.
“That reignited trade fears,” said Art Hogan, chief market strategist at B. Riley FBR. “While we may get some good news from trade negotiations between the U.S. and Canada … it feels like we’re going to get more bad news on China.”
Boeing fell as much as 1.3 percent before recovering to trade 1 percent higher. Caterpillar shares dropped as much as 1.2 percent but pared losses; it was last down 0.1 percent.
Trade worries coupled with tech’s recent decline have overshadowed strong economic data. The National Federation of Independent Business reported that small business optimism jumped to a record high last month, boosted by lower taxes and looser regulations.
Nick Raich, CEO of The Earnings Scout, said the fears overshadowing the market “have been overblown as the benefits from the Tax Cuts and Jobs Act and less regulatory burdens have outweighed the negative impact(s) from rising interest rates, tariffs and weakness abroad.”
Tesla’s stock dropped 3.7 percent after a Nomura analyst called the stock “no longer investable.”
Nike shares rose 1 percent after analysts at Canaccord Genuity upgraded them to buy from neutral. The analysts also said Nike’s ad featuring former San Francisco 49ers quarterback Colin Kaepernick was a “stroke of genius.”
The S&P 500 energy sector rose 1.1 percent and was on track to snap a seven-session losing streak. Energy shares got a boost from a sharp rise in oil. U.S. crude surged 2.7 percent to $69.38 per barrel.