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US Indexes Close Lower With China Trade Worries

The Dow Jones Industrial Average closed at 25,717.74 on Monday with a loss of 767.27 points or -2.90%. The S&P 500 closed at 2,844.74 for a loss of 87.31 points or -2.98%. The Nasdaq Composite closed at 7,726.04 for a loss of 278.03 points or -3.47%. The VIX Volatility Index was higher at 23.57 for a gain of 5.96 points or 33.84%.

Monday's market movers

Stocks closed lower Monday with news from China causing a global selloff. China's currency weakened to above 7 yuan to the dollar. China also ordered buyers in the country to stop U.S. agriculture purchases.

In currency markets, the U.S. dollar-Chinese yuan exchange rate ended the day at 7.0507. The U.S. Dollar Index was down 0.55% for the day despite gains against the yuan, falling to the euro and yen. In Treasuries, prices gained from the two-year note to the 30-year bond with the 30-year bond yield ending at 2.273%.

Second-quarter earnings also continued with the earnings calendar lighter this week. Companies making earnings headlines included:

  • Berkshire Hathaway (NYSE:BRK.A)(NYSE:BRK.B): Second-quarter operating profit was $6.14 billion, down from $6.89 billion a year ago.
  • Loews (NYSE:L): Beat earnings per share estimates by 7 cents.

Economic reports affecting market trading included the following:

  • The Markit Services PMI increased to 53 in July from 51.5.
  • The ISM Non-Manufacturing PMI decreased to 53.7 in July from 55.1. Separately, the ISM Non-Manufacturing Employment Index increased to 56.2 from 55, ISM Non-Manufacturing Business Activity Index decreased to 53.1 from 58.2, ISM Non-Manufacturing Prices Index decreased to 56.5 from 58.9 and the ISM Non-Manufacturing New Orders Index decreased to 54.1 from 55.8.
  • The Treasury held auctions for three-month bills at a rate of 1.990% and six-month bills at a rate of 1.950%.

In the S&P 500, the technology, financial and energy sectors led losses. In the Dow Jones Industrial Average, the following stocks led losses:

  • Apple (NASDAQ:AAPL) -5.23%
  • Visa (NYSE:V) -4.80%
  • IBM (NYSE:IBM) -4.43%

Small-cap stocks

In small caps, the Russell 2000 closed at 1,489.51 for a loss of 44.15 points or -2.88%. The S&P 600 closed at 911.71 for a loss of 26.43 points or -2.82%. The Dow Jones U.S. Small-Cap Growth Index closed at 9,588.14 for a loss of 304.83 points or -3.08%. The Dow Jones U.S. Small-Cap Value Index closed at 9,058.89 for a loss of 253.22 points or -2.72%.

Other notable indexes

Other notable index closes included the S&P 400 Mid-Cap Index at 1,860.83 for a loss of 53.70 points or -2.80%; the S&P 100 at 1,256.99 for a loss of 39.66 points or -3.06%; the Nasdaq 100 at 7,415.69 for a loss of 277.11 points or -3.60%; the Russell 3000 at 1,671.77 for a loss of 51.54 points or -2.99%; the Russell 1000 at 1,575.30 for a loss of 48.54 points or -2.99%; the Wilshire 5000 at 29,149.68 for a loss of 902.80 points or -3.00%; and the Dow Jones U.S. Select Dividend Index at 687.91 for a loss of 17.01 points or -2.41%.

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This article first appeared on GuruFocus.