Mixed as U.S.-China tensions reignite… Nasdaq down 0.76% [New York Stock Market Briefing]

The New York market finished mixed amid the fallout from U.S. President Donald Trump's critical remarks about China. Market anxiety rose after President Trump characterized China's halt to imports of U.S. soybeans as an 'act of hostility' and warned of a potential severing of trade ties.

On the 14th (local time) at the New York Stock Exchange, the Dow Jones Industrial Average closed at 46,270.46, up 0.44% from the previous trading day. By contrast, the Standard & Poor's (S&P) 500 index closed at 6,644.31, down 0.16%, and the tech-heavy Nasdaq closed at 22,521.7, down 0.76%.

In early trading, the three major indexes all opened lower on news of China's retaliatory measures. China added five companies, including the U.S. unit of Hanwha Ocean, to its list of sanctioned entities. The move came as tensions were rising in the shipping and shipbuilding sectors, with both countries exchanging measures over vessel entry fees.

As a result, the S&P 500 opened sharply lower by 0.78% and the Nasdaq by 1.35%. Later, as risk-off sentiment gained momentum, the S&P 500's decline widened to -1.50% and the Nasdaq's to -2.12%.

Subsequently, strong bargain-hunting buying pushed the indices sharply higher intraday. The Dow fell as much as -1.34% intraday before jumping to as much as 0.99%, producing intraday swings of over 1,000 points.

However, ahead of the close, President Trump's remarks again stoked market unease. On social media he warned, "China's halt to imports of U.S. soybeans is a clear act of hostility," and said he was "considering cutting off business relations with China related to cooking oil and other trade items."

Investors' anxiety was reflected in the volatility index (VIX). The Chicago Board Options Exchange (CBOE) volatility index briefly broke above 22 during the day, marking its highest level in four months.

Market attention also focused on the U.S. central bank (Fed)'s interest rate policy direction. Fed Chair Jerome Powell said the end of the tightening cycle appeared near. However, he remained cautious and withheld comment on whether benchmark rates would be cut in the future.

Powell said, "Downside risks to employment appear to have increased," and added, "As a result, I judged it appropriate to take one more step toward a more neutral policy stance at the September meeting."

By stock, major U.S. banks posted unexpectedly strong results, signaling a favorable third-quarter earnings season. In particular, Wells Fargo jumped 7.15% on the day, marking its largest daily gain since November last year. Citigroup also rose 3.89%.

NVIDIA plunged 4.41% after cloud provider Oracle said it would deploy 50,000 of AMD's advanced artificial intelligence (AI) chips in its cloud.

No Jeong-dong, Hankyung.com reporter dong2@hankyung.com