Stocks End Lower on U.S.-China Tension and Tech Worries

Stocks end lower on rising U.S.-China tensions and tech woes, while investors continue to parse major earnings reports.
Author:
Publish date:

Stocks were lower Friday as investors retreated from risk markets amid escalating political tension between Washington and Beijing, while parsing better-than-expected earnings reports from prominent names including Verizon  (VZ) - Get Report, American Express  (AXP) - Get Report, and Honeywell  (HON) - Get Report.

The Dow Jones Industrial Average finished down 182 points, or 0.68%, to 26,469, the S&P 500 declined 0.62% and the Nasdaq fell 0.94%. 

The Dow fell 0.8% for the week, breaking a three-week winning streak. The S&P 500 slipped 0.3% this week, posting its first weekly decline in four weeks. The Nasdaq lost 1.3% for the week. 

U.S. Secretary of State Mike Pompeo, in a speech late Thursday, called China's Communist Party a "Frankenstein" created by the detente policies of former President Richard Nixon. Pompeo attacked Beijing's record on trade, security and human rights.

China said the speech was "filled with ideological bias" while it announced the closure of the U.S. consulate in the southwestern city of Chengdu, in response to Washington's shuttering of the Chinese consulate in Houston.

Gold prices reached a record for the first time since 2011, prompted by an economic outlook clouded by the coronavirus pandemic, The Wall Street Journal reported. 

The most actively traded gold futures, for delivery in August, rose 0.4% to $1,897.50 a troy ounce, climbing for the sixth consecutive session. The figure eclipsed their August 2011 peak of $1,891.90.

Boeing Co.  (BA) - Get Report is preparing to delay its all-new 777X jet by several months or up to a year, as the coronavirus pandemic aggravates a drop in demand for the industry's largest jetliners, Reuters reported. Boeing shares finished down 1.5% at $173.76.

Intel  (INTC) - Get Report shares slumped 16% to $50.59 after the chipmaker said its new 7-nanometer processor is around six months behind schedule. The Santa Clara, Calif., chip giant  said it may have to seek outside help to catch up.

Apple  (AAPL) - Get Report shares edged down 0.3% to $370.46, pressed by both U.S.-China tensions and a report that suggested the tech giant could face a lawsuit led by several state attorneys general for allegedly deceiving customers.

McDonald’s  (MCD) - Get Report shares added 0.6% to $198.72 after the Chicago burger giant said it would require its customers to wear face coverings in its restaurants; pause reopening of dining areas in its restaurants for another 30 days, and add protective panels and barriers to the front and back sections of restaurants.

Verizon climbed 1.8% to $56.85 after reporting better-than-expected second-quarter earnings and sales as stability in its subscriber base linked to people's need to remain connected through the pandemic helped offset a drop in demand for new hardware. 

Honeywell slipped 2.8% to $149.43 after posting stronger-than-expected second-quarter earnings, but also reporting a significant slump in aerospace sales linked to Boeing's  (BA) - Get Report 737 MAX delays and weak demand for commercial aircraft.

American Express shares were off 1.4% to $95.33 after the credit-card giant posted an unexpected second quarter profit, but saw revenue fall nearly a third as consumer spending collapsed during the peak of the coronavirus pandemic.

Goldman Sachs Group  (GS) - Get Report shares edged down 0.8% to $201.47 after the investment bank reached a $3.9 billion settlement with the Malaysian government linked to a corruption scandal at the country's sovereign wealth fund.

JPMorgan Chase is "well-positioned to defend short-term returns and sustain its dividend over the next several quarters," a Goldman Sachs analyst said Friday, as he upgraded the financial service giant to buy from neutral. Analyst Richard Ramsden raised his share price target to $116 from $100. JPMorgan Chase shares were 0.7% lower at $98.28.

New single-family homes sold in June at a seasonally adjusted annual rate of 776,000, the Census Bureau and the Department of Housing and Urban Development estimated.

The figure is 13.8% above the revised May 2020 rate of 682,000 and 6.9% above the June 2019 estimate of 726,000.

The figure exceeded the estimates of analysts polled by Reuters, who’d seen the June figure rising 4% to a 700,000-unit pace.