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Dow falls 300 points as fears mount over drawn-out trade war

Lingering tensions with China and protests in Hong Kong pulled Wall Street into a second straight day of declines.
Image: Michael Urkonis
Traders work on the floor of the New York Stock Exchange.Richard Drew / AP
/ Source: Reuters

Wall Street fell on Monday, as investors shunned risky bets on fears that a drawn-out trade war between the United States and China would significantly hamper global growth.

The Dow Jones Industrial Average fell about 324 points, or 1.23 percent, by mid-afternoon. The S&P 500 and the Nasdaq both slipped by around 1 percent, marking the second straight day of declines.

President Donald Trump said on Friday he was not ready to make a deal with China, pouring cold water on any hopes that the dispute would end soon.

Highlighting the fallout of the trade dispute on global growth, a survey by Germany's Ifo economic institute on Monday showed the economic outlook for the third quarter has deteriorated worldwide.

Trade-related worries have been a major drag on the benchmark S&P 500, which has slipped 3.7 percent from its all-time high hit in July.

Investors seeking safety in perceived safe havens pushed the Japanese yen and U.S. government bond prices higher.

The so-called FAANG group — Facebook, Amazon, Apple, Netflix, and Google's Alphabet — which led the market rally this year, slipped as much as 1.3 percent.

The three main indexes had ended marginally lower last week, wrapping up five days of high-volume trading marked by wild swings, as investors feared that a slide in China's yuan would expand the scope of the trade war to include currencies.