Stocks end mixed-to-higher U.S.-China trade tensions weigh.
U.S. stocks traded mostly higher by Friday’s close, though gains were limited by fears that the United States and China won’t be able to resolve their trade dispute before the March 1 deadline.
All of Wall Street’s major indices opened sharply lower. The Dow Jones Industrial Average (NYSEARCA:DIA) was off 300 points through the early morning session. It would eventually pare losses to end down 63.27 points, or 0.3%, at 25,106.26.
The broader S&P 500 Index (NYSEARCA:SPY) reversed losses to finish 0.1% higher at 2,707.88. 0
Meanwhile, the technology-focused Nasdaq Composite Index (NYSEARCA:QQQ) edged down 0.1% to 7,282.02. Only four sectors reported gains. Energy and consumer discretionary shares declined sharply.
A measure of implied volatility known as the CBOE VIX (NYSEARCA:VXX) rose to more than one-week highs on Friday before reversing gains later in the session. The so-called “fear index” settled at 16.03, where it was down 2.1%. VIX traded as high as 17.63 earlier in the day.
President Trump confirmed on Friday that he will not be meeting with China’s Xi Jinping before March 1. A failure to reach a new trade agreement by that deadline would lead to the resumption of duties on Chinese imports unless both sides agree to extend the tariff truce agreed to in December.
The Bottom Line: With earnings season winding down, stocks are running out of catalysts to sustain the new-year rally. Investors can expect a downward shift in earnings beginning in Q1 2019. This could create additional headwinds for investors trying to salvage the bull market.