Continue Reading Below
The markets also were weighed down by continuing worries about how a prolonged trade conflict between the world's two biggest economies will affect corporate earnings and, because of the way tariffs increase costs, consumer spending.
Trump's decision last week to deny Huawei access to U.S. technology is expected to cause U.S. companies to cut ties with the world's No. 2 smartphone maker. Google, for example, is reportedly halting some services for the Huawei.
Meanwhile, Qualcomm suspended shipments to Huawei of its computer chips and told its employees not to communicate with the Shenzhen, China-based corporation.
Rick Meckler, partner at Cherry Lane Investments in New Vernon, New Jersey, said, "For a lot of these tech companies, there is no bigger market than China and there is some concern it could forestall growth, also forces countries to take sides and begin to allow China to develop alternatives," according to Dow Jones.
|I:DJI||DOW JONES AVERAGES||27154.2||-68.77||-0.25%|
|I:COMP||NASDAQ COMPOSITE INDEX||8146.488965||-60.75||-0.74%|
"It's a lot of speculation and there isn't any basis. But it looks like the trade talks are getting worse and not better."
Some analysts worry that the clash between the U.S. and China is not just about economics.
"If we assume the US-China trade war is about geopolitics and not just economics, the implications for markets are enormous," Bank of America warned in a note.
Shares of Sprint soared after the head of the Federal Communications Commission personally endorsed the merger of T-Mobile and Sprint.
The commission itself, however, was not expected to immediately give the combination its official imprimatur.
|TMUS||T-MOBILE US INC||77.43||-0.54||-0.69%|
The yield on the 10-year Treasury was flat at 2.3 percent.
Crude oil prices rose 0.3 percent to $62.95 per barrel.
China’s Shanghai Composite closed 0.41 percent, the Hang Seng closed off 0.57 percent, and Japan’s Nikkei 225 ended up 0.24 percent.
Britain’s FTSE 100 was down 0.99 percent, France’s CAC 40 tumbled 1.49 percent and Germany’s DAX declined 1.53 percent.