US open: Stocks head south following Asian sell-off
Wall Street stocks opened lower on Thursday following a drop in Asian indices overnight.
As of 1535 BST, the Dow Jones Industrial Average was down 0.19% at 26,819.59, while the S&P 500 was 0.53% weaker at 3,209.32 and the Nasdaq Composite came out the gate 1.25% softer at 10,418.48.
The Dow opened 50.51 points lower on Thursday, reversing losses seen in the previous session following some positive results from early trials of a coronavirus vaccine and more quarterly earnings reports.
Weighing on sentiment at the open was news that Chinese stocks had seen their single largest one-day loss since the start of the Covid-19 pandemic on Thursday amid a continued ratcheting up of tensions between Beijing and Washington appeared to dent appetite for stocks and riskier assets.
The White House was said to be contemplating a ban that would stop Chinese Communist Party members and their families from entering the US, according to The New York Times, while the administration stated it would also ban travel for employees of Chinese tech giant Huawei and other companies it sees as being complicit in helping Beijing abuse human rights.
The rise in tensions also overshadowed some solid economic data from China that showed second-quarter gross domestic product had expanded 3.2% year-on-year - topping consensus estimates for a reading of 2%.
Also in focus were more corporate earning from the US, with Johnson & Johnson shares edged lower despite beating expectations and raising guidance, while Bank of America stocks fell 2.54% despite delivering results that topped estimates.
Twitter shares were also down in early trading after several accounts were seemingly hacked as part of a coordinated social engineering attack aimed at siphoning bitcoins from followers, while Morgan Stanley shares ticked up following a strong quarterly earnings report.
On the macro front, American consumers continued to splash out at a much faster than expected pace last month. According to the Department of Commerce, in seasonally adjusted terms, US retail sales volumes increased at a month-on-month clip of 7.5% in June to reach $524.31bn.
Elsewhere, initial jobless claims in the US were little changed over the preceding week, hinting at the growing toll that moves to dial-back on the reopening the economy was taking on the country's labour market. According to the Department of Labor, initial jobless claims dipped by just 10,000 over the week ending on 11 July to reach 1.3m.
Also in focus, a key gauge of manufacturing in the US mid-Atlantic region slipped in July, but by less than anticipated and some of the details of the report were stronger than those for the prior month. The Federal Reserve Bank of Philadelphia's regional factory sector index retreated from a reading of 27.5 for June to 24.1. Economists had pencilled-in a reading of 20.0.
Lastly, business inventories fell 2.3% in May, in line with estimates, while total sales increased by 8.4%, and the latest reading of the National Association of Home Builders housing market index came in at 72 - up 14 from last month - indicating that the housing market may be ready to lead the country's post-Covid-19 economic recovery.