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* Trump vows to slap more tariff on Chinese imports
* U.S. employment growth slows in July
* Tech leads slide among major S&P sectors
* NetApp tumbles after slashing forecast
* Indexes down: Dow 0.48%, S&P 0.57%, Nasdaq 0.85% (Updates to open)
By Amy Caren Daniel
Aug 2 (Reuters) - Wall Street’s main indexes sank to one-month lows on Friday after a sharp escalation in U.S.-China trade tensions and tepid job growth in July reinforced fears of a global economic slowdown.
The Labor Department said nonfarm payrolls increased by 164,000 jobs last month and the economy created 41,000 fewer jobs in May and June than previously reported. However, July’s numbers were in line with economists’ expectations.
“Job numbers were not too far from expected. It shows the trend is slowing down. It’s consistent with another rate cut either in September or October,” said Scott Brown, chief economist at Raymond James in St. Petersburg, Florida.
“The bigger issue for the Fed policy outlook is tariffs because that implies you will see higher costs for finished goods rather than intermediate goods that we have been importing from China.”
The jobs report comes a day after President Donald Trump threatened to slap a 10% tariff on $300 billion of Chinese imports from next month, sending global markets tumbling overnight and investors fleeing to safe-haven U.S. Treasuries and the Japanese yen.
China on Friday said it would not be blackmailed and warned of retaliation.
Technology companies, which get a sizeable portion of their revenue from China, were the hardest hit, down 1.34%, weighed by iPhone maker Apple Inc and chipmakers.
The Philadelphia Semiconductor index slipped 1.06%, while shares of Apple fell 1.5%.
Boeing Co, the single largest U.S. exporter to China, fell 0.8% and Caterpillar Inc declined 0.6%.
The sudden escalation in trade rhetoric follows the Federal Reserve on Wednesday playing down expectations of further aggressive monetary policy actions after cutting interest rates for the first time in a decade.
Hopes that the Fed would be more accommodative to counter the impact of the bruising trade war had helped Wall Street’s main indexes hit record highs last month. Fed funds futures implied traders were positioned for a 100% chance the central bank would reduce its target range on interest rates by a quarter point in September, CME Group’s FedWatch program showed.
At 9:46 a.m. ET, the Dow Jones Industrial Average was down 128.15 points, or 0.48%, at 26,455.27, the S&P 500 was down 16.70 points, or 0.57%, at 2,936.86. The Nasdaq Composite was down 68.59 points, or 0.85%, at 8,042.53.
The defensive utilities sector rose 0.3%, while a surge in oil prices helped the energy sector eke out small gains.
The second-quarter earnings season is in full swing, with 74.4% of the 355 S&P 500 companies that have reported so far beating profit estimates, according to Refinitiv data.
NetApp Inc slumped 20.7% after the data storage equipment maker lowered its forecast for the first quarter and 2020, blaming a weakening macro environment.
Declining issues outnumbered advancers for a 2.24-to-1 ratio on the NYSE and for a 2.25-to-1 ratio on the Nasdaq.
The S&P index recorded four new 52-week highs and four new lows, while the Nasdaq recorded seven new highs and 76 new lows. (Reporting by Amy Caren Daniel and Medha Singh in Bengaluru; Editing by Anil D’Silva and Arun Koyyur)