By April Joyner and Noel Randewich
(Reuters) - A week of worsening fears on Wall Street leading up to Washington's increase on tariffs on Chinese goods has taken a toll on stocks that rely heavily on global trade.
With U.S. President Trump saying he is in no hurry to sign a deal with China, the United States raised its tariffs on $200 billion in Chinese goods to 25% from 10% on Friday, rattling financial markets already worried the 10-month trade war between the world's two largest economies could spiral out of control. China's Commerce Ministry has said it would take countermeasures against the increase in U.S. tariffs.
"Investors have been getting a little less bullish over the last week or so, and if China does decide to retaliate with tariffs, that's when sentiment can take a dive," said Matt Watson, portfolio manager at James Advantage Funds in Alpha, Ohio.
For a graphic on U.S.-China tariff war and the S&P 500, click: https://tmsnrt.rs/2WA1LWX
After Trump said last Sunday he was reversing a decision he made in February to keep tariffs at 10%, Wall Street descended from record highs reached at the start of the month.
Although the S&P 500 rose on Friday after more upbeat comments on trade from Trump and Treasury Secretary Steven Mnuchin, the index ended the week 2.17% lower. Trade-sensitive stocks were bogged down after having outperformed for most of 2019.
For a graphic on China-exposed stocks under pressure, click: https://tmsnrt.rs/2LxxNla
Shares of semiconductor companies, the U.S. sector that relies more than any other on China for its revenue, turned sharply lower this week, with the Philadelphia Semiconductor Index down 5.8% since Sunday and slashing its year-to-date gain to 28%.
For a graphic on Chip rally cut short, click: https://tmsnrt.rs/2Ww7yN0
The so-called FAANG tech group, volatile stocks that have fuelled a large part of Wall Street's rally in recent years, have also mostly underperformed as trade fears worsened, with shares of Netflix Inc and Apple Inc both down more than 6% for the week.
For a graphic on FAANG underperforms, click: https://tmsnrt.rs/2WCDjnF
Shares of industrial and materials companies, dependent upon global economic growth to boost their revenue, also underperformed. DowDuPont Inc shares tumbled 9.8% while Boeing Co shares dropped 5.8%.
For a graphic on Materials and industrials underperform, click: https://tmsnrt.rs/2LBsYYc
(Reporting by Noel Randewich and April Joyner; additional reporting by David Randall; editing by Alden Bentley, Rosalba O'Brien and Jonathan Oatis)
This story has not been edited by Firstpost staff and is generated by auto-feed.
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Updated Date: May 11, 2019 04:05:49 IST