The Federal Reserve announced several new measures on Monday to Stabilize Markets .

UPDATE: Wall Street dips as trade tensions with China ruffle investors

Stocks closed lower on Wall Street as tensions flared again between the U.S. and China and as more dismal news came out detailing economic fallout from the coronavirus pandemic.

The S&P 500 gave up 0.8% Thursday, but it’s still higher for the week at 2,948.51.

The Dow Jones Industrial Average closed down 101.78 or .41% to 24,474.12. 

The NASDAQ composite index ended down 90.90 or .97% to 9,284.88. 

The White House issued a report attacking Beijing’s economic policies and human rights violations, expanding on President Donald Trump’s get-tough rhetoric that he hopes will resonate with voters angry about China’s handling of the outbreak.

Meanwhile, the number of Americans thrown out of work since the virus struck climbed to nearly 39 million.

Markets were mostly weak due to troubling economic data out of Europe and Asia and as trade tensions between Washington and China appeared to worsen. 

Investors found little to like in the latest buildup of tensions between the U.S. and China and more dismal news about fallout related to the coronavirus pandemic. 

The White House issued a report attacking Beijing’s economic and military policies and human rights violations. 

Meanwhile Macy’s fell after saying it could lose more than a $1 billion during its first fiscal quarter.

» WEDNESDAY’S CLOSE: Wall Street bounces back strong as investors regain confidence

U.S. stocks have been spurred in recent days by higher by hopes for a potential vaccine and optimism the economy will recover in the second half as businesses reopen and stay-at-home orders are relaxed. 

» TUESDAY’S CLOSE: Stocks stumble as investors see more troubling signs on horizon

But the re-escalation of a tariff war with Washington over Beijing’s technology ambitions and trade surplus is creating more worry on top of the pandemic concerns. The two sides signed a truce in January but President Donald Trump says he might back out if China doesn’t buy more American farm products and other exports. 

The situation in China

China, where the coronavirus pandemic began in December, is rolling out an economic stimulus to revive its virus-battered economy, the first to start reopening in March. 

How much is Beijing ready to spend? Companies and the public are looking to the meeting of the ceremonial national legislature starting Friday for details. 

Now, facing a politically perilous wave of tens of millions of jobs lost, President Xi Jinping's government is promising to prop up employment to support the economy’s main growth engine — consumer spending. 

“We see huge unemployment pressure, and we need to see sizable stimulus to keep people employed,” said Citigroup economist Li-Gang Liu.  

Chinese manufacturing has rebounded but consumer spending, the main growth driver, is weak. 

Forecasters expect Beijing to channel extra money into job-creation efforts to head off a surge in unemployment and put money in consumers’ pockets. 

“Renewed trade tensions between the U.S. and China could weigh on markets in the coming months,” Esty Dwek of Natixis IM said in a report. “Higher volatility is likely, especially as ‘tough on China’ will clearly be a large part of Trump’s re-election campaign.” 

The outlook for the global economy meanwhile depends on infection numbers and vaccine development. Infection numbers are on the rise in the United States, Brazil and other countries. And China’s conflicts with Washington and Australia over the coronavirus, trade and Beijing’s technology ambitions are adding to uncertainty. 

Wire coverage

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China has blocked beef imports from four Australian suppliers in possible retaliation for Australia’s support for an investigation into the origin of the coronavirus pandemic. Meanwhile, the Trump administration has stepped up a feud over Beijing’s industrial ambitions by tightening controls on use of U.S. technology by tech giant Huawei. 

Investors are “trying to make heads or tails of the recent China trade spats with the U.S. and Australia,” Stephen Innes of AxiCorp said in a report. 

Investors were also looking ahead to Friday’s meeting of China’s legislature for details of possible new steps by Beijing to stimulate its virus-battered economy.  

Europe and Asia 

London and Frankfurt opened lower. Tokyo, Shanghai and Australia declined after spending the day swinging between gains and losses. 

Japan reported its exports fell 22% in April from a year earlier in their biggest decline since the 2008 crisis. Forecasters said they expect more export weakness due to slumping U.S. and European demand. 

In Europe, the FTSE 100 in London lost 0.8% to 6,018 and Frankfurt's DAX sank 1.4% to 11,070. The CAC 40 in France declined 1% to 4,452. 

In Asia, the Shanghai Composite Index lost 0.6% to 2,867.92 and the Nikkei 225 in Tokyo declined 0.2% to 20,552.31. The Hang Seng in Hong Kong lost 0.5% to 24,280.03. 

The Kospi in Seoul gained 0.4% to 1,998.31 and Australia’s S&P-ASX 200 lost 0.4% to 5,550.40. India's Sensex rose 0.7% to 31,036.60. New Zealand was off 0.5% and Singapore lost 0.1%. 

A survey of business managers in the eurozone showed that activity continued to shrink at a rapid pace in May, despite a slight pickup from the historic plunge in April. The publishers of the survey, IHS Markit, said it indicates a 9% drop in GDP this year, with a recovery likely to take years. 

Investors are looking to Premier Li Keqiang’s speech to China’s ceremonial legislature Friday for details of Beijing’s spending plans to speed up economic recovery.  

The latest on oil

In energy markets, benchmark U.S. crude rose 76 cents to $34.25 per barrel in electronic trading on the New York Mercantile Exchange. The contract gained $1.53 on Wednesday to $33.49. Brent crude added 75 cents to $36.50 per barrel in London. It rose $1.10 the previous session to $35.75. 

The price of oil has made a comeback this month as producing nations cut output and the gradual reopening of economies drove up demand. Crude started the year at about $60 a barrel but plummeted as demand sank due to travel and business shutdowns. 

The dollar gained to 107.75 yen from Wednesday’s 107.71 yen. The euro advanced to $1.0994 from $1.0960.

— This report was compiled and edited by ArLuther Lee for The Atlanta Journal-Constitution.

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