Stocks fell in morning trading Monday amid concerns about a growing trade dispute between the U.S. and China.
Overseas markets fell on worries about tensions between two of the world’s largest economies.
Late Friday, the U.S. administration imposed trade penalties on tires coming into the country from China. The Chinese government quickly condemned the move and filed a complaint with the World Trade Organization, calling it protectionist and a violation of global trade rules.
President Barack Obama has until Thursday to accept, reject or modify a U.S. International Trade Commission ruling that an increase of Chinese tires moving into the U.S. hurts American producers.
The growing tension comes ahead of the G-20 summit of rich and developing nations later this month in Pittsburgh.
In midmorning trading, the Dow Jones industrial average fell 52.37, or 0.6 percent, to 9,553.04. The Standard & Poor’s 500 index fell 5.76, or 0.6 percent, to 1,036.97, while the Nasdaq composite index fell 10.12, or 0.5 percent, to 2,070.78.
Obama will also be the center of attention as he gives a speech on the one-year anniversary of the collapse of Lehman Brothers Holdings Inc., which helped spark the worst period of the financial crisis and credit crunch. Obama will discuss the actions the government has taken to help the economy and stabilize the financial sector as well as further regulation needed to help avoid a future collapse during a speech near the New York Stock Exchange.
Investors will have little in the way of economic news Monday to provide further insight into a potential economic recovery. However, reports on inflation, retail sales, industrial product and housing starts are due later in the week.
Consumer spending and the housing market are both considered cornerstones to a strong economic rebound. Without a jump in consumer spending and improving home prices and sales, analysts say an economic recovery could be weak.
Major indexes fell Friday, ending a run of five straight gains. Stocks still posted big gains for the week, with the S&P 500 index adding 2.6 percent.
Light, sweet crude fell 17 cents to $69.12 a barrel on the New York Mercantile Exchange.
Bond prices mostly fell, pushing yields higher. The yield on the benchmark 10-year Treasury note rose to 3.38 percent from 3.35 percent late Friday.
The dollar rose against other major currencies, while gold prices fell.
The Russell 2000 index of smaller companies fell 3.76, or 0.6 percent, to 589.83.
Two stocks fell for every one that rose on the NYSE, where volume came to 167.2 million shares compared with 197.6 million shares traded at the same point Friday.
Overseas, Japan’s Nikkei stock average fell 2.3 percent. In afternoon trading, Britain’s FTSE 100 fell 0.3 percent, Germany’s DAX index lost 1 percent, and France’s CAC-40 dropped 1.1 percent.
Copyright 2009 The Associated Press.
