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Dow Plummets 3% As Trade Worries, Jobs Report Crush Stocks

Stock losses deepened in afternoon trading Friday, with the Dow Jones industrial average off 3% and major indexes wiping out much of the gains of the past few days.

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The Dow shed 738 points and each of its 30 components was down. Caterpillar (CAT) and Boeing (BA), two companies that face risks from a trade war, were down 4.6% and 4%, respectively. Both remain in the lower parts of price corrections.

The S&P 500 slid 2.7% and the Nasdaq composite lost 2.6%. The S&P 500 fell back below its long-term 200-day moving average, and the three big indexes are now down for the week.

Indexes were at session lows with about an hour to go in the trading week. They’ve erased about half of the gains from Wednesday’s lows. The Russell 2000 was off 2.2%. Volume was higher on the Nasdaq and lower on the NYSE compared with the same time Thursday. Losers led winners by a more than 5-1 ratio on the NYSE and by more than 4-to-1 on the Nasdaq.

Selling appeared to intensify after Treasury Secretary Steven Mnuchin said on CNBC that trade talks continue with China, but the Trump administration is prepared for an escalation.

Friday’s tumble means the rally attempt is in trouble but not dead. The Nasdaq and S&P 500 remain above the April 2 lows.

President Trump said late Thursday he may impose tariffs on an additional $100 billion of Chinese imports. It was the latest step in a brewing crisis in which the U.S. and China have traded tariff threats.

Fears of a trade war spread to other financial markets. U.S. crude oil — which is an export to China — fell 2.3% to $62.06 a barrel.

Gold prices, considered a haven asset, rose Friday. The SPDR Gold Shares ETF was up 0.4%.

The yield on the 10-year Treasury note fell 5 basis points to 2.78%. A disappointing jobs report contributed to the drop.

Friday morning, the March employment report showed an increase of 103,000 nonfarm jobs, well below forecasts. The unemployment rate of 4.1% was a tenth of a point higher than forecast, too.

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