US stocks ended lower, snapping a four-session rally, as a gloomy global economic growth outlook, trade concerns and disappointing company forecasts dampened sentiment.
All three major US stock indexes pared losses after White House economic adviser Larry Kudlow denied a report by the Financial Times that the Trump administration cancelled preparatory trade talks with China. Still, the S&P 500, the Nasdaq and the Dow all posted their biggest one-day percentage drops since 3 January.
On Monday, the IMF trimmed its 2019 global economic growth estimates, and China confirmed its slowest economic growth rate in 28 years. The downbeat China news pulled chipmakers lower. The Philadelphia SE Semiconductor index fell 2.9 per cent.
Each of the FAANG momentum stocks, Facebook, Apple, Amazon.com, Netflix and Google parent Alphabet, ended down between 1.6 per cent and 4.1 per cent. Fears of a slowdown in corporate profits mounted as companies posting fourth-quarter results provided disappointing forward-looking projections. Johnson & Johnson dropped 1.4 per cent after its 2019 sales forecast fell short of analyst expectations. Shares of Stanley Black & Decker tumbled 15.5 per cent after its disappointing 2019 forecast.
The Dow Jones Industrial Average fell 301.87 points, or 1.22 per cent, to 24,404.48. The S&P 500 lost 37.81 points, or 1.42 per cent, to 2,632.9 and the Nasdaq Composite dropped 136.87 points, or 1.91 per cent, to 7,020.36. Of the 11 major sectors of the S&P 500, all but utilities closed lower. Industrials, energy, communications services and consumer discretionary had the largest percentage losses.
