WASHINGTON (dpa-AFX) - Stocks have moved sharply lower over the course of the trading day on Friday, more than offsetting the recovery attempt seen in the previous session. With the drop, the major averages have fallen to their lowest intraday levels in over a month.
The major averages have moved roughly sideways in recent trading, lingering firmly in negative territory. The Dow is down 266.34 points or 1 percent at 25,562.02, the Nasdaq is down 116.82 points or 1.5 percent at 7,793.77 and the S&P 500 is down 32.96 points or 1.2 percent at 2,837.76.
The sell-off on Wall Street comes after President Donald Trump followed through on his threat to raise tariffs on Chinese imports.
The U.S. hiked the tariff on $250 billion worth of Chinese goods from 10 percent to 25 percent after the U.S. and China failed to reach a trade deal by a midnight deadline.
Additionally, Trump noted in a post on Twitter that the process has begun to place tariffs on the remaining $325 billion worth of Chinese imports.
Trump praised the massive tariff payments to the U.S. Treasury and said there is 'absolutely no need to rush' to reach a trade agreement with China.
'Tariffs will bring in FAR MORE wealth to our Country than even a phenomenal deal of the traditional kind. Also, much easier & quicker to do,' Trump tweeted.
'Tariffs will make our Country MUCH STRONGER, not weaker. Just sit back and watch!' he added. 'In the meantime, China should not renegotiate deals with the U.S. at the last minute. This is not the Obama Administration, or the Administration of Sleepy Joe, who let China get away with 'murder!'
The developments on the trade front have overshadowed a typically closely watched report from the Labor Department showing consumer prices increased by slightly less than expected in April.
The Labor Department said its consumer price index rose by 0.3 percent in April after climbing by 0.4 percent in March. Economists had been expecting another 0.4 percent increase.
Excluding food and energy prices, core consumer prices inched up by 0.1 percent for third consecutive month compared to economist estimates for a 0.2 percent uptick.
Compared to the same month a year ago, consumer prices in April were up by 2.0 percent, reflecting a modest acceleration from the 1.9 percent growth in March.
The annual rate of growth in core consumer prices also crept up to 2.1 percent in April from 2.0 percent in the previous month.
Sector News
Most of the major sectors have moved to the downside on the day, although biotechnology stocks are seeing particularly substantial weakness.
Reflecting the weakness in the biotech sector, the NYSE Arca Biotechnology Index is plunging by 2.9 percent to a four-month intraday low.
Significant weakness has also emerged among tobacco stocks, as reflected by the 2.9 percent slump by the NYSE Arca Tobacco Index. The index has dropped to its lowest intraday level in nearly three months.
Oil service stocks are also seeing considerable weakness despite a modest increase by the price of crude oil, moving sharply lower along with networking, transportation and semiconductor stocks.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region moved mostly higher on Friday, although Japan's Nikkei 225 Index bucked the uptrend and dipped by 0.3 percent. China's Shanghai Composite Index spiked by 3.1 percent and Hong Kong's Hang Seng Index advanced by 0.8 percent.
The major European markets turned mixed over the course of the session. While the U.K.'s FTSE 100 Index edged down by 0.1 percent, the French CAC 40 Index rose by 0.3 percent and the German DAX Index climbed by 0.7 percent.
In the bond market, treasuries are seeing modest strength amid concerns about the global economic outlook. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 1.8 basis points at 2.439 percent.
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