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* Trump advises U.S. companies to exit China
China unveils retaliatory tariffs on U.S. goods
* Powell says will "act as appropriate" to support growth
* Indexes down: Dow 1.87%, S & P 2.00%, Nasdaq 2.53% (Updates to late afternoon, changes dateline, byline)
By Stephen Culp
NEW YORK, Aug 23 (Reuters) – Wall Street plunged into a broad sell-off on Friday as China and the United States trades in their latest war, spooking investors and erasing slight gains following a positive US Federal Speech Reserve Chair Jerome Powell.
All three major U.S. stock indexes turned sharply lower, setting a course for their fourth consecutive weekly declines after Donald Trump President tweeted that U.S. companies should "immediately start looking for an alternative to China."
Trump pressed American companies to leave China in response to an increase of $ 75 billion in US goods. little sign of abating.
"It's mind-boggling," said Ken Polcari, senior managing director at Butcher Joseph Asset Management in New York. "On one day (Trump) tells you everything is going great with China and today"
"That's why the market is taking the most recent dive south of the world (Trump's) tweets," Polcari added. "Not because of Jackson Hole or anything Powell said." "It's all about the anxiety and it's all over the weekend."
Earlier in the session, US Federal Reserve Chair Jerome Powell, speaking to the Fed's annual meeting in Jackson Hole, Wyoming, reiterated that the central bank would "act as appropriate" to keep the current economic expansion afloat, but otherwise gave few clues as to whether an interest rate cut in the cards at the next month's policy meeting.
President Trump's tweeted response to the speech labeled Powell an "enemy."
Yields for 2-year and 10-year U.S. Treasury entered inversion territory, a recessionary red flag. The curve has been changed in the past.
The CBOE Volatility index, a gauge of market anxiety, jumped 3.85 to 20.49 points, its highest reading in a week.
The Dow Jones Industrial Average fell 489.79 points, or 1.87%, to 25,762.45, the S & P 500 lost 58.52 points, or 2.00%, to 2,864.43 and the Nasdaq Composite dropped 201.95 points, or 2.53%, to 7,789.44.
All 11 major sectors in the S & P 500 were in negative territory, with tech, energy, consumer discretionary, industrials and communications services all down 2% or more.
Shares of Apple Inc., which has significant exposure to the Chinese market, 4.5%
Trade-sensitive chipmakers dropped on the bellicose trade rhetoric, with the Philadelphia SE Semiconductor index dipping 3.9%.
Salesforce.com Inc. rose 3.1% after the cloud-based service provider's beat-and-raise earnings report.
Specialty retailer Foot Locker Inc. plunged 16.6% on the heel of disappointing second-quarter results.
Computer hardware company HP Inc. announced the departure of chief executive officer and expected lower-than-expected fourth quarter profit, sending its shares down 6.2%.
Second-quarter earnings season is essentially in the can, with 482 of the companies in the S & P 500 having reported. Of those, 73.9% have consensus expectations, according to Refinitiv data.
Analysts now see 3.2% year on year earnings growth for the quarter, up significantly from the 0.3% gain seen at the beginning of July, by Refinitiv.
Declining issues outnumbered advancing ones on the NYSE by a 4.10-to-1 ratio; on Nasdaq, a 4.74-to-1 ratio favored decliners.
The S & P 500 posted 33 new 52-week highs and 28 new lows; the Nasdaq Composite recorded 37 new highs and 142 new lows.
(Reporting by Stephen Culp, additional reporting by Charles Mikolajczak Editing by Chizu Nomiyama)
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