US STOCKS-Wall St retreats as trade war fears compound virus woes

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* Philadelphia chip index tumbles
* Wall St indexes eye worst week since mid-March
* Indexes fall: Dow 0.27%, S&P 0.34%, Nasdaq 0.45%

(Updates to open)
By Ambar Warrick and Medha Singh
May 15 (Reuters) - U.S. stocks dropped on Friday as signs of
deteriorating trade relations between the United States and
China added to economic worries due to the novel coronavirus
pandemic.
The Trump administration moved to block semiconductor
shipments to China's Huawei Technologies HWT.UL from global
chipmakers. China was swift to respond with a report saying it
was ready to put U.S. companies on an "unreliable entity list,"
according to the Global Times. China's countermeasures include launching investigations and
imposing restrictions on U.S. companies such as Apple Inc
AAPL.O , Cisco Systems Inc CSCO.O , Qualcomm Inc QCOM.O , as
well as suspending purchase of Boeing Co BA.N airplanes, the
report said, citing a source.
Boeing fell 2.5%, the most among the constituents of the Dow
Jones index .DJI , while Apple was down 1.4%.
Trade-sensitive chipmakers also declined, with the
Philadelphia chip index .SOX losing 2.4%.
The ratcheting up of Sino-U.S. tensions comes a day after
President Donald Trump signaled a deterioration of his
relationship with China over the virus outbreak, saying he has
no interest in speaking to President Xi Jinping right now and
going so far as to suggest he could even cut ties with Beijing.
"The overarching concern that we've had as this epidemic has
worked its way around the globe is that U.S.-China relations are
heading in the wrong direction and that can cause a worse
economic effect than the pandemic itself," said Art Hogan, chief
market strategist at National Securities in New York.
After a strong rally from their 2020 lows, the three major
stock indexes are on course for their worst week since
mid-March, as sobering comments on the pandemic from major U.S.
officials pointed to a longer period of economic weakness.
Meanwhile, economic data continued to paint a grim picture
with the latest batch of reports indicating U.S. retail sales
and manufacturing output endured record declines in April as the
virus-led slump seeped into the second quarter.
At 10:10 a.m. ET, the Dow Jones Industrial Average .DJI
was down 64.04 points, or 0.27%, at 23,561.30, the S&P 500
.SPX was down 9.83 points, or 0.34%, at 2,842.67 and the
Nasdaq Composite .IXIC was down 40.51 points, or 0.45%, at
8,903.21.
Eight of the 11 major S&P sectors were lower with real
estate .SPLRCR and utilities .SPLRCU posting the biggest
percentage declines. Healthcare .SPXHC , consumer staples
.SPLRCS and energy stocks .SPNY were the only ones higher.
Abbott Laboratories ABT.N slipped 1.4% after the U.S. Food
and Drug Administration said the company's speedy coronavirus
test could potentially be inaccurate, but can still be used to
test patients. Declining issues nearly matched advancers on the NYSE and
the Nasdaq.
The S&P index recorded three new 52-week highs and no new
low, while the Nasdaq recorded 22 new highs and seven new lows.