U.S. Stocks Regain Ground After Early Slump But Remain Mostly Lower

After coming under pressure early in the session, stocks have regained some ground over the course of the trading day on Thursday. The major averages have climbed well off their worst levels of the day but remain in negative territory.

Currently, the Nasdaq is down 146.02 points or 0.8 percent at 18,406.71 and the S&P 500 is down 35.71 points or 0.6 percent at 5,806.92. The narrower Dow is posting a more modest loss, down 91.64 points or 0.2 percent at 42,914.95.

The early sell-off on Wall Street came as ongoing concerns about the economic impact of President Donald Trump’s new tariffs on Canada, Mexico and China led traders to cash in on yesterday’s strong gains.

While Trump’s decision to grant a one-month tariff exemption for automakers contributed to a turnaround on Wednesday, uncertainty about further exemptions are weighing on Wall Street.

A report from Bloomberg said Trump is considering exempting certain agricultural products from the tariffs imposed on Canada and Mexico.

Stocks regained some ground after Commerce Secretary Howard Lutnick told CNBC all goods and services that are compliant with the United States-Mexico-Canada trade agreement will likely be excluded from Trump’s tariffs for one month.

In U.S. economic news, the Labor Department released a report showing first-time claims for U.S. unemployment benefits fell by more than expected in the week ended March 1st.

The report said initial jobless claims dipped to 221,000, a decrease of 21,000 from the previous week’s unrevised level of 242,000. Economists had expected jobless claims to edge down to 235,000.

On Friday, the Labor Department is scheduled to release its more closely watched report on employment in the month of February.

The Commerce Department also released a report showing the U.S. trade deficit widened by more than expected in the month of January.

The report said the trade deficit surged to $131.4 billion in January from a revised $98.1 billion in December. Economists had expected the trade deficit to jump to $123.0 billion from the $98.4 billion originally reported for the previous month.

The notably wider trade deficit came as the value of imports soared by 10.0 percent to $401.2 billion, while the value of imports increased by 1.2 percent to $2.698 billion.

Sector News

Semiconductor stocks are turning in some of the market’s worst performances on the day, with the Philadelphia Semiconductor Index slumping by 2.2 percent.

Considerable weakness is also visible among commercial real estate stocks, as reflected by the 1.7 percent loss being posted by the Dow Jones U.S. Retail Index.

Utilities, networking and computer hardware stocks are also seeing notable weakness, while steel and housing stocks have moved to the upside.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher on Thursday. Japan’s Nikkei 225 Index climbed by 0.8 percent, China’s Shanghai Composite Index jumped by 1.2 percent and Hong Kong’s Hang Seng Index surged by 3.3 percent.

Meanwhile, the major European markets are turning in a mixed performance on the day. While the U.K.’s FTSE 100 Index is down by 0.8 percent, the French CAC 40 Index is up by 0.3 percent and the German DAX Index is up by 1.4 percent.

In the bond market, treasuries are extending the pullback seen over the two previous sessions. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 7.1 basis points at 4.338 percent.