US stocks tumbled on Thursday, erasing this year's slim gains in the S&P 500 and the Dow Jones Industrial Average, a
US stocks tumbled on Thursday, erasing this year's slim gains in the S&P 500 and the Dow Jones Industrial Average, as the arrest of a top Huawei executive sparked fears of a flare-up in Sino-US tensions, while weak oil prices added more pressure.
The arrest of Chinese smartphone maker Huawei Technologies Co Ltd's chief financial officer in Canada for extradition to the United States cast fresh doubts over the prospect of Washington and Beijing striking a deal in their 90-day truce period.
The markets enjoyed a mini rally last week through Monday after the Federal Reserve signaled that the pace of rate increases could slow and the China-US truce over the weekend.
But optimism over a trade resolution faded Tuesday and, along with a drop in longer-dated U.S Treasury yields, rekindled worries of slowing economic growth and sent Wall Street sliding.
Benchmark 10-year Treasury yield held at three-month lows on Thursday and piled more pressure on the market along with a drop in oil prices after the OPEC signaled it may agree to a smaller-than-expected cut in crude output.
"In general, we all have the same questions we did on Tuesday," said Art Hogan, chief market strategist at B. Riley FBR in New York. "The news on Huawei throws another level of uncertainty on our ability to actually come to some agreement with China."
Data showed the US trade deficit jumped to a 10-year high in October, suggesting the Trump administration's tariff-related measures to shrink the trade gap were ineffective.
All the 11 major S&P sectors were lower, led by the technology sector's 1.93 percent drop.
Worries over Huawei, one of the largest buyers of chips according to research firm Bernstein, sent the Philadelphia Semiconductor index tumbling 2.30 percent.
The trade-sensitive industrial sector fell 1.88 percent. Energy stocks retreated 2.92 percent, while the drops in the bond market pushed financials 2.51 percent lower.
At 10:04 a.m. ET, the Dow was down 460.33 points, or 1.84 percent, at 24,566.74, the S&P 500 was down 48.34 points, or 1.79 percent, at 2,651.72 and the Nasdaq Composite was down 119.75 points, or 1.67 percent, at 7,038.68.
The CBOE Volatility Index, known as Wall Street's "fear gauge", jumped to its highest since Oct. 30.
Apple Inc fell 3.1 percent and was the biggest drag on the S&P and the Nasdaq, while trade bellwether Boeing Co's 1.9-percent decline weighed the most on the Dow.
Declining issues outnumbered advancers for a 6.84-to-1 ratio on the NYSE and a 3.85-to-1 ratio on the Nasdaq.
The S&P index recorded two new 52-week highs and 63 new lows, while the Nasdaq recorded four new highs and 261 new lows.