Stock market falters as U.S.-China relations continue to deteriorate

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the

Dow Jones Industrial Average

was up slightly as relations between the United States and China continued to crumble, while Chinese regulators continued to crack down on its companies listed in the United States.

The Dow Jones added 24 points, or 0.1%, while the

S&P 500

increased by 0.2% and the

Nasdaq Composite

was up 0.1%.

But the losses were ugly in China and Hong Kong, where the

Hang Seng

fell by more than 4% and the

Shanghai Composite

fell 2.3%.

Tencent

dropped to 8%, while

Tencent Music

(ticker: TME) fell 1.9% after the State Administration for Market Regulation ordered the company to give up its exclusive music licensing rights, further cracking down on competition. E-commerce platform operator

Meituan

fell 11%, and the Chinese Internet giant

Ali Baba

fell 5% in late trading.

Prosus,

the technology investor in companies including Tencent, plunged 7% in Amsterdam.

The private education sector was in free fall, however, as China said teacher training institutions were prohibited from raising funds on the stock market and foreign capital could not invest, in what is clearly targeted on the market. wave of listed companies in the United States.

New oriental education and technology

fell by 47%,

China Beststudy Education

lost 41% and

Koolearn technology

fell 33%. Chinese educational stocks listed in the United States, including

NLP Education

and

Gaotu Techedu

tumbled Friday in anticipation of a crackdown.

“[The] The big news overnight was that the Chinese continued to attack their capitalism and crush some of their big, lucrative companies, many of which are listed in the United States, ”writes Andrew Brenner of NatAlliance Securities. “No fraud or downgrading, just being regulated out of the company to make a profit.”

Deputy Foreign Minister Xie Feng added to the concerns further, calling on the United States to change its “highly mistaken mindset and dangerous policy” during a meeting with Deputy Secretary of State Wendy Sherman.

the

Nikkei 225

however, rose 1% in Tokyo after a four-day hiatus. The Stoxx Europe 600 slipped 0.1%.

The renewed tension in China comes at the start of a busy week for US investors. The Federal Reserve will begin its two-day monetary policy meeting on Tuesday, before delivering its decision on Wednesday. Many expect to see a discussion of tapering, meaning a downsizing of the Fed’s current bond buying program, which could potentially put pressure on stock prices. Still, investors know these talks have started, so it’s unclear whether official confirmation of this will impact stocks. “With most investors expecting a decline in late 2021 or early 2022, this may not be much of a hawkish surprise for the markets,” writes Andrew Hollenhorst, Citigroup economist.

Profits season in full swing this week, with the electric vehicle maker exits

You’re here

(TSLA) after Monday’s close, and tech giants

Apple

(AAPL),

Alphabet

(GOOGLE),

Amazon

(AMZN),

Microsoft

(MSFT) and

Facebook

(FB) all are expected to release figures this week.

While earnings have far exceeded expectations, stocks are not responding fully. With about a quarter of S&P 500 companies reporting, cumulative profit beats an 18% margin, according to Credit Suisse. But companies that beat on earnings saw their shares rise only 0.28% the day after the report on average before Monday’s session, according to data from Wells Fargo. Companies that missed the estimates saw their shares fall 2.1% on average.

Bitcoin gained 13% to $ 38,853.89 on Monday after Amazon.com placed a cryptocurrency and blockchain ad, suggesting the online retail giant will start accepting payments .

Hasbro

The share (HAS) rose 11.6% after posting profit of $ 1.05 per share, beating estimates of 47 cents per share, on sales of $ 1.3 billion, above expectations of $ 1.2 billion.

Lockheed Martin

The stock (LMT) fell 3.3% after posting profit of $ 6.52 per share, missing estimates of $ 6.53, on sales of $ 17 billion, higher than expectations of 16, $ 9 billion.

DR Horton

The stock (DHI) fell 1.1% even after being upgraded to Outperform Neutral at Wedbush.

Spotify technology HER

The stock (SPOT) fell 2.5% after being demoted to Sell from neutral at Redburn.

Lowe’s Cos.

The stock (WEAK) fell 1.7% after being demoted to Neutral from Outperforming to Wedbush.

Aon

(AON) gained 8.1% after merging with

Willis Towers Watson

(WLTW) was canceled due to regulatory concerns. Willis Towers Watson stock fell 7%.

Write to Jacob Sonenshine at [email protected]