US equities finished little unchanged on Friday as the major indexes recovered from the sessions lows after President Trump spooked the market suggesting he wanted to move forward with tariffs on $200 billion in Chinese goods. The initial sell-off following the release of the news prompted some seller pressure in the markets as the Dow fell as low as 26068.29 and closed the session 26154.67, yet after bottoming out investors bought the dip and saw the Dow along with the S&P 500 and the Nasdaq close the trading day little unchanged from the open.
Financials rose along with bond yields as data released Friday which indicated U.S. retail sales recorded their smallest gain in six months in August, but upward revisions to July data likely kept expectations of strong third-quarter economic growth intact. Yields on benchmark 10 year Treasury notes finished at 2.994 percent while further out on the curve 30 year yields finished at 3.1320 percent. Two year note yields climbed to finish at 2.78 percent which brought the 2/10 year spread in to 21 basis points.
On the back of the potential spike in yields the interest rate sensitive utilities sector fell 0.50 percent for the session. Also weighing on utilities was NiSource shares which tumbled 11.7 percent after fire investigators said they suspected a unit of the company, Columbia Gas, was linked to a series of gas explosions in Boston suburbs on Thursday.
The Van Eck Vectors Semiconductor ETF (SMH) gained 1 percent led higher by gains in Nvidia which rose nearly 2 percent after a broker raised its price target for the stock noting the company’s dominance in machine learning. Micro Technology Inc. shares rose 1.56 percent and Advanced Micro Devices rose 6.5 percent.
In other stock specific news, shares of insurer Travelers were up 0.9 percent as analysts cut loss estimates from Hurricane Florence as the storm weakened and Walmart lost 0.6 percent after Goldman Sachs raised questions around the purchase of a majority stake in India's Flipkart. In a quiet week for earnings share in Adobe Systems rose 2.3 percent, a day after the company topped quarterly revenue and profit expectations. Tonight we have FedEx and Oracle Corp reporting.
In currency markets, the dollar rose against a basket of currencies as the dollar index was higher by 0.4 percent at 94.926, the euro was down 0.5 percent at $1.16325 and sterling was 0.3 percent lower at $1.3063.
Chart of the day: AUDUSD hourly chart