US stocks face pressure of pessimism led by trade tensions

Technology shares pulled Wall Street lower on Friday, as scepticism over the United States and China reaching a trade deal before a looming deadline added to investor's nerves over slowing global growth. Another round of talks is set for next week in Beijing, but President Donald Trump on Thursday fanned worries when he said he did not plan to meet Chinese President Xi Jinping before the March 1 deadline set for reaching a trade pact. If the two countries fail to reach an agreement by then, additional U.S. tariffs on Chinese imports will come into force.

The trade-sensitive industrials shed 0.39 per cent as planemaker Boeing Co lost 0.9 per cent and also weighed on the blue-chip Dow index. Chip stocks, which get a huge chunk of their revenue from China, also slipped. The Philadelphia chip index lost 1.07 per cent

"Investors are experiencing another hiccup in the trade talks and with the March deadline approaching fast, they are being a tad cautious," said Andre Bakhos, managing director at New Vines Capital LLC in Bernardsville, New Jersey. "The market is reducing exposure in some of these big names for no other reason than to take some profits and remove some risk until we find a better scenario with tariffs."

All the major S&P sectors were in the red with the technology sector's 0.50 per cent decline, and the consumer discretionary sector's 0.83 per cent fall, weighing the most. Amazon.com Inc's 2.38 per cent drop, along with Apple Inc's 0.5 per cent decline, dragged on the benchmark S&P 500 and the tech-heavy Nasdaq.

Trade tensions added to growth worries, which resurfaced on Thursday after the European Union cut its economic growth forecasts and the Bank of England warned of Britain facing its weakest economic growth in a decade. However, the S&P 500 is 14.5 per cent higher from the 20-month lows it hit in December, spurred by a dovish Federal Reserve, hopes of a U.S.-China trade deal and largely positive fourth-quarter earnings.

With earnings season crossing its halfway mark, 71 per cent of the S&P 500 companies that have reported beat profit estimates, according to IBES data from Refinitiv. But concerns remain about slowing earnings growth. Growth forecast for the current-quarter has dropped to 0.1 per cent from 5.3 per cent at the start of the year.

At 9:53 a.m. ET, the Dow Jones Industrial Average was down 154.11 points, or 0.61 per cent, at 25,015.42. The S&P 500 was down 13.16 points, or 0.49 per cent, at 2,692.89 and the Nasdaq Composite was down 46.29 points, or 0.64 per cent, at 7,242.06. Coty Inc jumped 26.63 per cent - the most on the S&P 500 - after the cosmetics maker reported better-than-expected quarterly results.

Mattel Inc gained 26 per cent after the toymaker posted a surprise quarterly profit as it benefited from a makeover of its iconic Barbie doll. Declining issues outnumbered advancers for a 1.60-to-1 ratio on the NYSE and for a 1.47-to-1 ratio on the Nasdaq. The S&P index recorded 10 new 52-week highs and no new lows, while the Nasdaq recorded 10 new highs and 15 new lows.