US close: Stocks fall for second straight day as trade concerns take centre stage
Wall Street stocks closed lower for a second consecutive day on Wednesday after the White House hardened its stance on trade talks with China.
At the close, the Dow Jones Industrial Average was down 0.17% at 26,004.83, while the S&P 500 closed 0.20% softer at 2,879.84 and the Nasdaq Composite saw out the session 0.38% weaker at 7,7792.72.
The Dow closed 43 lower on Wednesday after ending its daily winning streak at six on Tuesday, finishing the session 14 points lower as tech stocks took a hit on the back of claims from Commerce Secretary Wilbur Ross that Chinese tech giants Huawei and ZTE both presented national security threats on Tuesday.
"Both are doing practices that we think are potentially injurious to our national security," Ross said.
Investors also digested comments made earlier in the week by Donald Trump, when he threatened China with a further hike in tariffs if President Xi Jinping refused to meet with him at the upcoming G20 summit in Japan.
Trump also said he would not soften his stance unless Beijing agreed on as many as five "major points" - he did not specify as to exactly what these trade issues were.
In terms of data news, consumer prices in the US slipped by more than expected last month amid declines in the price of energy and for used cars and trucks.
The year-on-year rate of increase in headline consumer prices slipped from 2.0% in April to 1.9% for May, according to the Department of Labor.
At the core level meanwhile, which excludes food and energy, CPI was up by 0.1% versus April and by 2.0% on a year ago (consensus: 2.1%).
Elsewhere, the US recorded a $208bn budget deficit in May, a jump of 41% year-on-year, according to the Treasury Department.
The majority of the jump was a result of 1 June falling on a weekend, forcing some federal payments into May. However, excluding those calendar adjustments, the deficit still increased by 8%, with spending up 6% and revenue up 4%.
On the corporate front, Mattel shares were 5.27% higher at the close after the Barbie maker turned down a merger offer from MGA Entertainment, the company behind the likes of LOL Surprise and Bratz.
Mattel has struggled with declining sales volumes of late, however, the group has made an effort to forge new partnerships and delve deeper into entertainment via its deal with Pixar and an expanded deal with Warner Brothers.
Bank shares also dropped alongside Treasury yields, with Citigroup down 1.58%, while JP Morgan Chase and Bank of America slipped 1.27% and 1.03%, respectively.
Tech stocks were in focus again, with VanEck Vectors Semiconductor dropping more than 2.17%, while Lam Research lost 5.29% and other semiconductor manufacturers, such as Applied Materials, KLA-Tencor and Teradyne, also fell.
Facebook shares slid 1.7% after the Wall Street Journal revealed emails linking chief executive Mark Zuckerberg to the social media giant's controversial privacy policies.
Lululemon Athletica was up 4.15% in extended trading after beating on sales and earnings in its first trading quarter.