US stocks dropped Monday as the coronavirus crisis stoked fresh US-China tensions and struggling airlines suffered another blow.
The Dow Jones industrial average fell as much as 362.53 points, or 1.5 percent, to 23,361.16 as the Trump administration’s efforts to blame China for the pandemic sparked fears of a new trade war.
The S&P 500 also dropped as much as 1.1 percent by midday with airline shares plummeting after investment maven Warren Buffett revealed that he dumped his company’s stake in major US carriers.
But the tech-heavy Nasdaq managed to climb as much as 0.6 percent, thanks in part to solid gains for tech giants Amazon, Microsoft, Netflix and Tesla.
Monday’s dip followed a weekend in which the President Trump accused China of trying to cover up the coronavirus outbreak and Secretary of State Mike Pompeo said there’s “enormous evidence” that the pandemic began in a Wuhan lab.
The comments came after Trump threatened new tariffs against China in response to Beijing’s handling of the outbreak. The fresh tensions have investors worried about the two nations restarting the trade war that was partially settled fewer than four months ago.
“This could have a serious impact on the risk appetite of investors, as there are already plenty of uncertainties caused by the COVID-19 pandemic, and a continuation of the trade war would be a nightmare come true,” said Milan Cutkovic, market analyst at AxiCorp.
With Post wires