Stock Market Today: Trump's Swing at China Sends Nasdaq Into Correction

The Nasdaq has plunged 10% in three days, with the latest hit coming Tuesday after President Trump suggested an economic "decoupling" with China.

(Image credit: Getty Images)

A stock market that was already full of jitters got something a little more tangible to worry about over the weekend, and that spilled out into Tuesday trade that sent the Nasdaq Composite into a correction.

President Donald Trump on Labor Day said America would "end reliance on China once and for all, whether it's decoupling or putting in massive tariffs like I've been doing already." China, meanwhile, announced an initiative to help set global data-security standards -- a counter to America's "Clean Network" guidelines that would exclude some Chinese firms.

Large tech firms took the worst of it, including Tesla (TSLA (opens in new tab), -21.1%). Standard & Poor's surprised many market observers by not adding the electric vehicle maker to the S&P 500. Instead, online marketplace Etsy (ETSY (opens in new tab)), automatic test equipment supplier Teradyne (TER (opens in new tab)) and health care tech and manufacturing firm Catalent (CTLT (opens in new tab)) will be elevated as of Sept. 21. Out will be tax preparer H&R Block (HRB (opens in new tab)), beauty company Coty (COTY (opens in new tab)) and discount department-store chain Kohl's (KSS (opens in new tab)).

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The tech-heavy Nasdaq Composite finished 4.1% lower to 10,847. The blue-chip index has now dropped 10% in the past three trading sessions, putting it in correction territory (a drop of 10% or more).

Other action in the stock market today:

  • The Dow Jones Industrial Average closed with a 2.3% decline to 27,500.
  • The S&P 500 lost 2.8% to 3,331.
  • The Russell 2000 was the "least bad" major index, declining 2.0% to 1,504.

Also, don't forget to check out this week's earnings calendar to see which pivotal reports are coming up.

Know How to Protect Yourself

If you haven't already, consider reviewing your defensive options. Even if the market isn't looking over a deep cliff like it was in late February, more experts are calling for continued turbulence in the weeks ahead. "Market volatility is returning after months of steady advances in risk assets," writes the BlackRock Investment Institute. "Valuations have risen, and we could see greater volatility in coming months as a result, especially as the U.S. election closes in."

The Pros' Picks: 9 Stocks to Sell Now

Bonds and gold could yet again act as stores of protection, but it's easier buy both with funds -- these seven gold ETFs allow you to buy either the metal itself or the miners who collect it, while these 12 bond funds provide access to several categories of fixed income.

But if you want to remain invested in stocks while still shielding yourself from catastrophe, utility stocks are returning to form. Here, we examine 11 top-rated utility stocks to buy now, including a couple of sector picks that have really broken the mold this year.

Kyle Woodley
Senior Investing Editor, Kiplinger.com

Kyle is senior investing editor for Kiplinger.com. As a writer and columnist, he also specializes in exchange-traded funds. He joined Kiplinger in September 2017 after spending six years at InvestorPlace.com, where he managed the editorial staff. His work has appeared in several outlets, including U.S. News & World Report and MSN Money, he has appeared as a guest on Fox Business Network and Money Radio, and he has been quoted in MarketWatch, Vice and Univision, among other outlets. He is a proud graduate of The Ohio State University, where he earned a BA in journalism.