Wall Street stocks edge lower following heavy losses

Stay informed with free updates

US stocks slipped on Friday, deepening a sell-off in the tech sector that has put the S&P 500 on course for its worst week since September.

The S&P was down 0.2 per cent in early trade, taking its losses for the week to 2.7 per cent. The Nasdaq Composite index shed 0.8 per cent, extending Thursday’s heavy losses.

Losses also spread to Asia and Europe on Friday, as US President Donald Trump’s latest tariff threats on key trading partners including the EU and China kept investors on edge.

“The last days have been painful to a number of investors . . . Trump’s tariff announcement has rattled the already fragile market,” said Mohit Kumar, an analyst at Jefferies.

Chipmaker Nvidia, the biggest winner from investor enthusiasm for artificial intelligence over the past two years, fell 0.8 per cent on Friday, having lost 8.4 per cent the previous day despite beating analysts’ forecasts with its fourth-quarter earnings.

In Europe, the broad Stoxx Europe 600 fell 0.3 per cent, with a 0.5 per cent fall in Germany’s exporter-heavy Dax and a 0.4 per cent decline in France’s benchmark Cac 40 index.

Dutch chipmaking equipment group ASML fell 2.8 per cent in afternoon trade as the tech sell-off spread to the bloc.

Earlier, Japan’s Nikkei 225 index lost 2.9 per cent, South Korea’s Kospi slid 3.4 per cent and Hong Kong’s Hang Seng index fell 3.3 per cent. Mainland China’s CSI 300 benchmark lost 2 per cent.

Investors had been blindsided on Thursday by the latest trade salvo from Trump, who said he would impose an additional 10 per cent tariff on Chinese imports and press ahead with levies on Canada and Mexico from March 4.

Despite a barrage of threats since taking office last month, Trump has so far only imposed a 10 per cent tariff on Chinese imports, but there are signs that the spectre of a trade war has dented consumer confidence in the US, the world’s largest economy.

Confidence this month fell by the most since August 2021, according to a Conference Board Consumer Confidence Index released this week.

But the worries about the health of the economy only added to investor concerns about valuations in the high-flying tech sector.

Nvidia is no longer the electrifying force it was for US stocks for much of the past two years, when its blowout quarterly results often powered the wider market higher.

“Nvidia didn’t save the world,” said Mike Zigmont, co-head of trading at Visdom Investment Group. “The results were great but not so mind-blowingly great that everyone wants to buy more stocks.”

Trump’s election victory in November powered US stocks higher on hopes the new administration would enact pro-business economic policies, but the S&P 500 has fallen back in recent days as focus has instead turned to the potential threats to the US economy.

Retail investors, who have so often stepped in to buy stocks whenever the market dips, are suddenly gripped by “unease”, according to VandaTrack, a data company that monitors retail trading flows.

“I think to a level this is a healthy correction. There is some profit taking,” said Winnie Wu, an equity strategist at Bank of America. “The market always tries to price a five year story in five days or five weeks.”

The retreat from riskier assets has hit cryptocurrencies hard in recent days. Bitcoin fell 3 per cent and ethereum shed 5.6 per cent.