Concerns about the vitality of Asian markets, in particular China’s, may also be weighing on the investment mood. Shanghai’s composite index SHCOMP, -2.94%fell 2.9% and the Shenzhen A-Share 399106, -2.73% dropped 2.7%.
Weakness in Beijing’s markets came after China’s currency, the yuan, briefly touched its weakest level since January of 2017. One buck last fetched 6.9379 yuanUSDCNY, -0.0014% up 0.2%. Those currency moves came after Treasury refrained from labeling China a currency manipulator in its biannual report on currency practices released late Wednesday.
The U.S. and China have been locked in a trade spat that doesn’t show signs of easing and that threatens to produce intermittent headwinds for markets.
”Technically, we have been pointing out that stocks were vulnerable as leadership was very narrow at the top with everyone owning FANG stocks either outright or through ETFs and mutual funds. Corrections are normal [and] so far this looks to be a correction that could carry further, setting up the possibility for a year-end rally later on,” he said. FANG is an acronym for popular tech stocks made up of Facebook Inc. FB, +0.15% Amazon.com Inc. AMZN, +0.24% Netflix Inc.NFLX, +0.16% and Google parent Alphabet Inc. GOOG, +0.32% GOOGL, +0.43%