Wall Street opens sharply lower as investors react to fading US-China trade optimism
- Falling United States (US) Treasury bond yields weigh on financials.
- All 11 major sectors of the S&P 500 sectors started the day in the red.
- White House is reportedly looking to restrict capital flows into China.
Major equity indexes in the United States (US) started the day deep in the negative territory on Tuesday as the latest headlines surrounding the US-China trade dispute revived concerns over a protracted trade war and its potential negative impact on the economy. The CBOE Volatility Index, Wall Street's fear gauge, is now up more than 7% on the day.
As of writing, the Dow Jones Industrial Average was down 0.9% on the day while the S&P 500 and the Nasdaq Composite were erasing 1% and 0.85%, respectively.
Earlier in the day, Bloomberg reported that the Trump administration was planning to limit capital inflows from China into the US government pension funds. Moreover, the South China Morning Post claimed that the Chinese delegation was expected to leave the US earlier than initially planned.
The dismal market mood weighed on the Treasury bond yields and caused the S&P 500 Financials Index to lose more than 1.6% in the early trade. Additionally, the trade-sensitive Industrials and Technology indexes are erasing 1.5% and 1.22%, respectively.