Stocks finish in negative territory to start the week as attention shifts to China trade talks.
The U.S. stock market declined Monday, as investors turned their attention to high-stakes trade talks with China later this week.
All of Wall Street’s major indices reported losses in the first session of the week. The Dow Jones Industrial Average (NYSEARCA:DIA) declined 95.77 points, or 0.4%, to close at 26,477.95.
The large-cap S&P 500 Index (NYSEARCA:SPY) fell 0.5% to finish at 2,938.78. Ten of 11 primary sectors reported declines, with consumer staples leading the pack. Energy stocks also fell sharply.
A measure of implied volatility known as the CBOE VIX (NYSEARCA:VXX) rose on Monday. The so-called “investor fear index” reached a session high of 18.52 on a scale of 1-100 where 20 represents the historic average. It would eventually settle at 17.64, having gained 3.5%.
The United States and China are set to resume trade talks Oct. 10-11. Vice Premier He Liu has confirmed that China will not be making sweeping overhauls of its industrial policies – something the Trump administration had demanded to reach a new trade deal.
Both countries remain locked in a drawn-out trade dispute that has disrupted global economic growth. Manufacturing in both countries is also teetering on the brink of recession.
The Final Word: Based on the latest news out of China, a comprehensive trade deal with Washington is unlikely this week. A failure to reach a new agreement could spell trouble for the bull market, which came close to reclaiming record highs last month.