Stock markets fall after APEC summit highlights China-U.S. trade tension
Plunging tech stocks pull Dow down 1.9%, with TSX falling over energy woes
Technology stocks were hammered Monday after an Asia Pacific Economic Co-operation meeting this weekend highlighted the trade tensions between the U.S. and China.
The bad news sent the Dow into a 1.6 per cent slide as investors pulled out of Apple and internet shares. It was down 500 points before recovering to 25,017 at the close. The broader S&P index fell 1.7 per cent to 2,690.
The tech-based Nasdaq fell more than three per cent to 7,028, its lowest close in six months
In Toronto, concern over energy pulled the market lower as the low price of oil and difficulties of getting Canadian crude to market weighed on the index. The TSX was down 85 points at 15,071, wiping out gains made last week.
West Texas Intermediate, the benchmark North American crude contract, rose 30 cents to $56.76 US a barrel. But the Western Canada Select contract is at $17.70 because of a glut of oil and lack of pipeline capacity to Alberta.
Today Alberta Premier Rachel Notley announced she has asked three "special envoys" to work with energy sector experts and CEOs to find solutions for closing the oil-price differential.
That comes after some in the oil patch suggested one solution might be caps on production.
The health care sector, including major marijuana companies, also lost ground in Toronto.
On the U.S. markets, Apple stock fell four per cent after the company cut production orders for three iPhone models it released in September.
Facebook and other social media stocks were under pressure because of continued controversy over their role in Russia's meddling with U.S. elections. Facebook was down seven per cent, MIcrosoft down four per cent and Netflix fell five per cent.
In the wake of the Cambridge Analytica scandal, the tech industry is also bracing for federal regulation to protect consumer privacy.
But a lot of the pessimism centred around the isolationist stance of the U.S. on trade issues, which could result in depressed global demand for tech products.
U.S. vice-president Mike Pence represented the U.S. at the APEC summit, usually a non-controversial forum for advancing trade. Instead, he and Chinese President Xi Jinping gave speeches full of veiled criticism of each other, and the summit ended without a communiqué.
China and the U.S. are engaged in a tariff war, escalating duties on one another's goods in defiance of world trade rules. That threatens to disrupt global supply chains, especially for the tech giants.