US STOCKS-Trump tweetstorm sinks Wall Street as trade war rages on

Reuters

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    * Trump advises U.S. companies to exit China
    * China unveils retaliatory tariffs on U.S. goods
    * Powell says will "act as appropriate" to support growth
    * Indexes down: Dow 1.87%, S&P 2.00%, Nasdaq 2.53%

 (Updates to late afternoon, changes dateline, byline)
    By Stephen Culp
    NEW YORK, Aug 23 (Reuters) - Wall Street plunged in a broad
sell-off on Friday as China and the United States traded their
latest salvos in a prolonged trade war, spooking investors and
erasing slight gains following a generally positive speech by
U.S. Federal Reserve chair Jerome Powell. 
    All three major U.S. stock indexes turned sharply lower,
setting a course for their fourth consecutive weekly declines
after President Donald Trump tweeted that U.S. companies should
"immediately start looking for an alternative to China."
 urn:newsml:reuters.com:*:nL2N25J0XP
    Trump pressed American companies to leave China in response
to an earlier announcement from Beijing that it would impose a
new round of retaliatory tariffs on an additional $75 billion in
U.S. goods, upping the ante in an acrimonious trade war that has
roiled markets for months and shown little sign of abating.
 urn:newsml:reuters.com:*:nL4N25J301  urn:newsml:reuters.com:*:nL4N25J3II
    "It is mind-boggling," said Ken Polcari, managing principal
at Butcher Joseph Asset Management in New York. "On one day
(Trump) tells you everything is going great with China and today
he is saying everyone get out of China." 
    "That is why the market is taking the most recent dive south
is just because of (Trump's) tweets," Polcari added. "Not
because of Jackson Hole or anything Powell said. It's all driven
by the anxiety and it's Friday and a lot can happen over the
weekend." 
    Earlier in the session, U.S. Federal Reserve chair Jerome
Powell, speaking the Fed's annual meeting in Jackson Hole,
Wyoming, reiterated that the central bank would "act as
appropriate" to keep the current economic expansion afloat, but
otherwise gave few clues as to whether an interest rate cut was
in the cards at next month's policy meeting.  urn:newsml:reuters.com:*:nL2N25J0QG
    President Trump's tweeted response to the speech labeled
Powell an "enemy."
    Yields for 2-year and 10-year U.S. Treasuries entered
inversion territory, a classic recessionary red flag. The curve
has traded in and out of inversion for the past three days.  
    The CBOE Volatility index  .VIX , a gauge of market anxiety,
jumped 3.85 points to 20.49, its highest reading in a week.
    The Dow Jones Industrial Average  .DJI  fell 489.79 points,
or 1.87%, to 25,762.45, the S&P 500  .SPX  lost 58.52 points, or
2.00%, to 2,864.43 and the Nasdaq Composite  .IXIC  dropped
201.95 points, or 2.53%, to 7,789.44.
    All 11 major sectors in the S&P 500 were in negative
territory, with tech  .SPLRCT , energy  .SPNY , consumer
discretionary  .SPLRCD , industrials  .SPLRCI  and
communications services  .SPLRCL  all down 2% or more.
    Shares of Apple Inc  AAPL.O , which has significant exposure
to the Chinese market, sank 4.5%
    Trade-sensitive chipmakers dropped on the bellicose trade
rhetoric, with the Philadelphia SE Semiconductor index  .SOX 
dipping 3.9%.  urn:newsml:reuters.com:*:nL2N25J101
    Salesforce.com Inc  CRM.N  rose 3.1% after the cloud-based
service provider's beat-and-raise earnings report.  urn:newsml:reuters.com:*:nL4N25I49X
    Specialty retailer Foot Locker Inc  FL.N  plunged  16.6% on
the heels of disappointing second-quarter results.  urn:newsml:reuters.com:*:nL4N25J2TQ
    Computer hardware company HP Inc  HPQ.N  announced the
departure of chief executive officer Dion Weisler and forecast
lower-than-expected fourth quarter profit, sending its shares
down 6.2%.
    Second-quarter earnings season is essentially in the can,
with 482 of the companies in the S&P 500 having reported. Of
those, 73.9% have beaten consensus expectations, according to
Refinitiv data.
    Analysts now see 3.2% year on year earnings growth for the
quarter, up significantly from the 0.3% gain seen at the
beginning of July, per Refinitiv. 
    Declining issues outnumbered advancing ones on the NYSE by a
4.10-to-1 ratio; on Nasdaq, a 4.74-to-1 ratio favored decliners.
    The S&P 500 posted 33 new 52-week highs and 28 new lows; the
Nasdaq Composite recorded 37 new highs and 142 new lows.  

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S&P 500 drops 1% after Trump threatens to counter China tariffs 
  https://tmsnrt.rs/2Zh1Y6Q
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 (Reporting by Stephen Culp; additional reporting by Charles
Mikolajczak
Editing by Chizu Nomiyama)
 ((stephen.culp@thomsonreuters.com; 646-223-6076;))

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