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Investing.com – The Dow managed a positive week after cutting losses to end the day flat on Friday, as investors weighed up rising U.S.-China tensions against ongoing efforts to lift economically damaging restrictions nationwide.
The Dow Jones Industrial Average closed flat, after cutting its intraday losses to post its best weekly win in since April 9. The S&P 500 added 0.24%, while the Nasdaq Composite rose 0.43%
U.S. and China trade tensions flared as the Trump administration raised concerns about China’s plan to impose a new security law in Hong Kong that threatens the autonomy of the city.
“The United States strongly urges Beijing to reconsider its disastrous proposal, abide by its international obligations, and respect Hong Kong’s high degree of autonomy, democratic institutions, and civil liberties,” U.S. Secretary of State Mike Pompeo said on Friday.
Pompeo’s statement echoed that of President Donald Trump, who a day earlier said the U.S. “will address (China’s proposed security plans) very strongly.”
The rebuke of Beijing’s plans for Hong Kong comes as Trump’s ongoing criticism over China’s handling of the coronavirus pandemic has many concerned that the two economic superpowers could resume their trade war.
Energy stocks led the broader decline as oil prices fell on fresh worries about crude demand after Chinese officials ditched the country’s economic growth target of 6% to 6.5% in the wake of the Covid-19 outbreak.
Halliburton (NYSE:HAL), Devon Energy (NYSE:DVN) and Baker Hughes (NYSE:BKR) were among some of the biggest decliners in energy.
On the earnings front, Deere (NYSE:DE) fell 1.5% after its fiscal second-quarter results were better than feared and helped counter bearish guidance. The company warned that annual performance would be hurt by the pandemic.
Foot Locker (NYSE:FL) reported a wider-than-expected loss for the first quarter of 25 cents, with comparable sales slumping 42.8%, sending its shares down 8.7%.
Nvidia (NASDAQ:NVDA) was up 2.8% after reporting results and guidance that topped estimates, led by solid growth in its data center business.
Elsewhere, Roku (NASDAQ:ROKU) fell 5.38% after Stephens downgraded the stock to equal-weight from overweight on fears the shares have little fundamental backing to move markedly higher from current levels.
The ongoing efforts to reopen the economy, meanwhile, were given the backing of Dr. Anthony Fauci, who in a CNBC interview said now is the time to “begin to seriously look at reopening the country to try to get back to some degree of normal.”
As the economy reopens, some have warned there could be a risk of a second wave of infections. But the U.S. will not go into lockdown if the pandemic stakes for a second time, Trump said on Thursday.
