Wall Street falls on weak earnings, US-China tensions

NEW YORK — Wall Street stocks tumbled Friday following disappointing results from Amazon, Exxon Mobil and other companies amid worries of increased tensions between China and the United States over blame for the coronavirus.

      The Dow Jones Industrial Average dropped 2.6 per cent, or more than 620 points, at 23,723.69.

      The broad-based S&P 500 shed 2.8 per cent to 2,830.71, while the tech-rich Nasdaq Composite Index dropped 3.2 per cent to 8,604.95.

      The losses marked an ugly start to a new month after major indices scored their biggest monthly gains in decades in April.

      Amazon dove 7.6 per cent after the company cautioned that earnings in the second quarter would be entirely wiped out by expenses related to COVID-19 as it works to keep up with surging demand at a time when many brick-and-mortar stores are closed.

      Exxon Mobil was another big loser, shedding 7.1 per cent as it reported a $610 million loss in the first quarter, its first loss in decades.

      Analysts also pointed to comments from US President Donald Trump claiming that the coronavirus originated in a Chinese lab.

      Trump threatened tariffs on Beijing, escalating a blame game between the two biggest economies and reviving investors' trade war worries.

      Trump "clearly wants to make China bashing a central platform for his re-election campaign," said LBBW's Karl Haeling.

      "Let's hope he just talks but doesn't really do anything" significant, he said.

      Friday's session punished several travel-oriented companies that clawed back some of their losses in April after devastating drops in March. These included American Airlines, down 11.4 per cent, Marriott International, down 6.8 per cent, and Boeing, down 5.5 per cent.

      Tesla also plunged, losing 10.3 per cent after Chief Executive Elon Musk said on Twitter that shares were overvalued.