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* Trump says China deal could be delayed until election
* S&P 500, Dow on track for worst day in nearly two months
* Trade-sensitive chip index hits near two-month low
* Indexes drop: Dow 1.29%, S&P 0.95%, Nasdaq 0.93%
(Updates to late afternoon, changes dateline, byline)
By Stephen Culp
NEW YORK, Dec 3 (Reuters) - Wall Street set course for its
third consecutive sell-off on Tuesday as investor optimism over
a potential near-term respite from the U.S.-China trade war
evaporated following commentary from President Donald Trump and
Commerce Secretary Wilbur Ross.
All three major stock indexes stepped further away from last
week's record highs that were fueled by hopes that an interim
deal between the United States and China was in the offing.
Those hopes dimmed as President Trump suggested a deal might
have to wait until after the 2020 election, and separately,
Secretary Ross confirmed that new tariffs on Chinese imports
would go into effect on Dec. 15 as scheduled, unless substantial
progress was made. These comments, on the heels of France's threatened
retaliation over potential new U.S. duties on French products,
itself a retaliation against a proposed French "digital tax,"
suggested that America's hydra-headed tariff war against its
major trading partners would continue to dominate markets for
the foreseeable future. "We've seen this happen numerous times, where there's a
trade disappointment and there's a stock market sell-off," said
Bucky Hellwig, senior vice president at BB&T Wealth Management
in Birmingham, Alabama. "There's disappointment that 'phase 1'
(of a U.S.-China deal) has been pushed back."
Tariff-sensitive chipmakers were down, with the Philadelphia
SE Semiconductor index falling 2.0%, on track for its worst day
in nearly two months.
The Dow Jones Industrial Average .DJI fell 357.45 points,
or 1.29%, to 27,425.59, the S&P 500 .SPX lost 29.61 points, or
0.95%, to 3,084.26 and the Nasdaq Composite .IXIC dropped
79.97 points, or 0.93%, to 8,488.01.
Nine the 11 major sectors in the S&P 500 were in negative
territory, with momentum stocks Apple Inc AAPL.O and
Amazon.com AMZN.O weighing heaviest.
Financials .SPSY , consumer discretionary .SPLRCD and
energy .SPNY stocks, as well as trade-vulnerable industrial
.SPLRCI and tech .SPLRCT sectors suffered the largest
percentage losses.
Shares of AK Steel Holding Corp AKS.N rose 3.3% after
miner Cleveland Cliffs CLF.N agreed to buy the company in an
all-stock deal worth about $1.1 billion. Audentes Therapeutics Inc's BOLD.O shares soared by 105.5%
after Japan's Astellas Pharma Inc 4503.T said it would buy the
U.S. drugmaker for about $3 billion in cash. Declining issues outnumbered advancing ones on the NYSE by a
1.80-to-1 ratio; on Nasdaq, a 1.82-to-1 ratio favored decliners.
The S&P 500 posted 1 new 52-week highs and 5 new lows; the
Nasdaq Composite recorded 29 new highs and 63 new lows.