Friday's Stock Market Close: US Equities Close Lower On Uncertainties About China Trade Deal, Oil Futures Plunge

U.S. equity indexes fell on Friday ending a holiday-shortened week, as traders remained concerned about the ongoing trade talks with China ahead of the possible imposition of more tariffs on Chinese imports on Dec. 15.

The Dow Jones Industrial Average dropped 112.59 points to 28,051.41 while the S&P 500 fell 12.65 points to 3,140.98 and the Nasdaq Composite Index lost 39.70 points to 8,665.47.

For the week the Dow edged up 0.06% while the S&P 500 eked out an 0.001% gain.

Friday’s volume on the New York Stock Exchange totaled 1.25 billion shares with 1,099 issues advancing, 97 setting new highs, and 1,820 declining, with 20 setting new lows.

Active movers were led by Clovis Oncology (CLVS), NIO Inc. (NIO), and United States Steel Corp. (X)

Crude oil futures plunged as Iraqi Prime Minister Adel Abdul-Mahdi said Friday he will resign, as civil disturbances roil the oil-rich country.

Crude oil futures plummeted 4.41% to $55.55 per barrel and Brent crude dropped 3.98% at $60.75. Gold futures rose 0.64%.

China’s foreign ministry warned of consequences following President Donald Trump’s decision late Wednesday to sign a bill that supports pro-democracy protesters in Hong Kong.

“I signed these bills out of respect for President Xi, China and the people of Hong Kong,” Trump said in a statement. “They are being enacted in the hope that leaders and representatives of China and Hong Kong will be able to amicably settle their differences leading to long term peace and prosperity for all.”

China’s Vice Foreign Minister Le Yucheng told U.S. Ambassador Terry Branstad the bill represented “serious interference in China’s internal affairs and a serious violation of international law.”

The Chinese Foreign Ministry also said in passing the bill, the U.S. "ignored facts, turned black to white, and blatantly gave encouragement to violent criminals who smashed and burned, harmed innocent city residents, trampled on the rule of law and endangered social order."

Concerns have been raised about the potential negative repercussions of the Hong Kong bill on ongoing trade talks between the U.S. and China.

“The real issue is not the Hong Kong bill,” Macquarie Group’s Thierry Wizman told Bloomberg. “The real issue is whether or not if you do not see convergence on those negotiations by Dec. 15, do we get an increase, a scheduled increase, in those U.S. tariffs and does that derail the negotiations?”

But Michael Hirson, Asia director at Eurasia Group, said Trump's bill signing "will not derail trade negotiations.”

"To be sure, Beijing is angered at the U.S. for interfering in what China considers its domestic affairs and for emboldening the protest movement," he said. "But some of China's anger over the bill is posturing for the domestic audience, and Beijing will not be so upset as to let this stand in the way of a truce over trade."

Adobe Analytics projected U.S. shoppers spent $5.7 billion on Thanksgiving Day, a 16.4% rise over last year. Adobe expected $7.5 billion in spending for Black Friday, a 20.5% increase over the past year, and $9.4 billion in sales, a 19.1% rise, for Cyber Monday.

The Bank of Korea left interest rates unchanged at 1.25% after having enacted two cuts recently, citing concern about the global economy.

German luxury carmaker Daimler AG said it plans to cut thousands of jobs by end of 2022 and lower staff expenses by 1.4 billion euros ($1.54 billion).

Overnight, Asian markets were down as the Hang Seng plunged 2.03% while Japan's Nikkei 225 dropped 0.49% and China's Shanghai Composite fell 0.61%.

European markets were all lower with the FTSE 100 closing down 0.93% while Germany's DAX slipped 0.07% and France's CAC 40 fell 0.13%.

The euro was up 0.11% to $1.021 while the pound sterling rose 0.21% to $1.294.

The yield on the 10-year Treasury rose 0.62% to 1.767% while yield on the 30-year Treasury gained 0.46% to 2.203%.