Stocks began the session deep in negative territory as investors grew more concerned over a potential trade war with China. After last month’s announcement of tariffs on aluminum and steel imported into the U.S., the Office of the United States Trade Representative proposed an additional duty of 25% on a list of products from China. China said it would respond in kind, which appeared to stun the market even though both sides had recently telegraphed the moves. As the market has digested the news, the averages pared their losses and now stand at their best levels of the day. ECONOMIC EVENTS: In the U.S., payroll company ADP estimated that private sector employment increased by 241,000 jobs from February to March. Markit’s final services PMI dropped 1.9 points to 54.0 in March from a reading of 55.9 in February. The ISM non-manufacturing index fell 0.7 points to 58.8 in March after slipping 0.4 points to 59.5 in February. Factory orders increased 1.2% in February, largely erasing the 1.3% January drop. In Asia, China’s Ministry of Commerce announced that it will levy 25% reciprocal tariffs on 106 U.S. products including planes, soybean, automobile, chemicals, wheat, corn, cotton, sorghum, tobacco and beef. The agency said the move is in response to the United States’ proposal to impose a 25% tariff on imported high-tech products. China said the reciprocal tariffs will apply to around $50B of U.S. imports. COMPANY NEWS: Boeing (BA), Deere (DE) and Caterpillar (CAT) are among the stocks sliding in apparent reaction to news that China plans to impose tariffs on American products, including airplanes, automobiles and soybeans, in retaliation against President Donald Trump’s proposed penalties on Chinese goods. Automakers Ford (F) and General Motors (GM), which initially moved lower amid the Chinese trade headlines, have recovered and turned positive near midday… CBS (CBS) delivered orally on Friday a takeover proposal for Viacom (VIAB) that offered 0.55 shares of CBS for each Viacom share, CNBC’s David Faber reports, citing sources. The offer was immediately rejected and Viacom is expected to put forth a counter, according to Faber, who added that Viacom believes the “market price ratio” is 0.62 per CBS share and wants above that ratio. MAJOR MOVERS: Among the noteworthy gainers was Acxiom (ACXM), which rose 7% after CEO Scott Howe said that the company has seen some signs that Facebook (FB) is reconsidering its data import policy. Also higher was homebuilder Lennar (LEN), which gained 6% after reporting quarterly results. Among the notable losers was Cloudera (CLDR), which plunged 40% after reporting quarterly results and providing worse than expected guidance for Q1 and fiscal 2019. Also lower was Acuity Brands (AYI), which fell 6% after reporting quarterly results and announcing an increased share repurchase program. INDEXES: Near midday, the Dow was down 91.51, or 0.38%, to 23,941.85, the Nasdaq was up 6.25, or 0.09%, to 6,947.53, and the S&P 500 was down 4.24, or 0.16%, to 2,610.21.
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