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US open: Stocks slide as tech shares, stimulus talks remain in focus

By Iain Gilbert

Date: Monday 21 Sep 2020

US open: Stocks slide as tech shares, stimulus talks remain in focus

(Sharecast News) - Wall Street stocks opened lower on Monday as tech shares struggled again and Chinese trade relations and stimulus negotiations also remained in focus.
As of 1530, the Dow Jones Industrial Average was down 2.86% at 26,867.22, while the S&P 500 was 2.50% weaker at 3,236.35 and the Nasdaq Composite came out the gate 2.14% softer at 10,562.49.

The Dow Jones opened 790.20 points lower on Monday, extending last week's losses.

Talks surrounding a second US stimulus bill were in focus on Monday as the passing of Supreme Court Justice Ruth Bader Ginsburg, and the nomination process for her successor ahead of the election, was seen as potentially throwing a spanner in the works and delaying the bill until sometime after 3 November.

Donald Trump said he would announce his nomination for Bader Ginsberg's vacant seat by Saturday.

Also on investors' minds, news that the UK was considering yet another national lockdown to curb an increase in new cases of Covid-19 across the country led to sharp declines in stocks of Carnival, Southwest Airlines and Delta Air Lines.

Tensions between Washington and Beijing were also in focus, with the Chinese Ministry of Commerce releasing long-awaited provisions on its so-called "unreliable entity list", a day after the US instituted its ban on WeChat and TikTok.

On the macro front, the Chicago Federal Reserve's national activity index fell to 0.79 in August from a revised 2.54 in the prior month. The three-month moving average slipped to 3.05 from 4.23 in July.

The July index was revised from an initial estimate of 1.18 and the June index was revised to a record high 5.84 from 5.33.

Elsewhere, Federal Reserve heads Lael Brainard, John Williams and Robert Kaplan will all deliver speeches throughout the course of the day.

In corporate news, Nikola shares tumbled 18.57% in early trade after revealing that founder and chairman Trevor Milton would be stepping down from the company amid accusations of fraud from short-selling firm Hindenburg Research.

Technology stocks were also under pressure at the start of trading amid valuation concerns - shares in Apple, Microsoft and Amazon were all at least 1% lower early in the session.

No major corporate earnings were slated for release on Monday.

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