Stocks finish mixed as trade-related headlines provide jolt

U.S. stocks finished near session lows after receiving a jolt from trade-related headlines.

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The major averages at 1:30 p.m. ET slide to fresh session lows after Hu Xijin, editor in chief of China's state-run Global Times, tweeted "China is not as anxious to reach a deal as the US side thought."

Following a brief recovery, stocks fell even further after a report from the South China Morning Post quoted Trump trade adviser Michael Pillsbury as saying the U.S. could again raise the tariffs on Chinese goods.

"Does the president have options to escalate the trade war? Yes, the tariffs can be raised higher," he said. "These are low-level tariffs that could go to 50 percent or 100 percent."

The comments from the two men came as the U.S. and China held deputy-level trade talks, with the goal of paving the way for high-level talks in early October.

The Dow Jones Industrial Average lost 52.29 points, or 0.2 percent. The S&P 500 and Nasdaq were little changed.

TickerSecurityLastChangeChange %
I:DJIDOW JONES AVERAGES27024.8+237.44+0.89%
SP500S&P 5002995.68+29.53+1.00%
I:COMPNASDAQ COMPOSITE INDEX8148.705552+100.06+1.24%

All-time highs remain within reach for all three of the major averages. A print above the following levels would be the highest on record:

  • <strong>S&amp;P 500: </strong>3,027.98
  • <strong>Dow Jones Industrial Average: </strong>27,398.68
  • <strong>Nasdaq: </strong>8,339.64

Bank stocks finished lower, a day after the Fed's decision to cut interest rates.

TickerSecurityLastChangeChange %
CCITIGROUP INC.71.22+0.98+1.40%
JPMJP MORGAN CHASE & CO.119.96+3.51+3.01%
BACBANK OF AMERICA CORP.29.73+0.59+2.02%
WFCWELLS FARGO & COMPANY50.11+0.84+1.70%

On the earnings front, Darden Restaurants was lower after reporting mixed quarterly results and same-store sales that fell short of estimates.

U.S. Steel was under pressure after saying it sees a loss of 35 cents a share for the three months ending in September, blaming restructuring costs and a fire at one of its facilities. The steelmaker also cut its outlook for the second half of the year.

TickerSecurityLastChangeChange %
DRIDARDEN RESTAURANTS INC.110.29-0.16-0.14%
XUNITED STATES STEEL CORPORATION11.43+0.27+2.42%

Oil prices were higher Thursday after Iran Foreign Minister Javad Zarif said there would be "all out war" in the event of a military strike on his country. U.S. Secretary of State Mike Pompeo on Wednesday called the drone attacks on a Saudi oilfield an "act of war" by Iran. West Texas Intermediate and Brent crude oils were higher by at least 1.2 percent.

Buying of Treasurys had the U.S. 10-year yield down 4 basis points at 1.757 percent.

In Europe, Britain's FTSE, Germany's DAX and France's CAC were all higher.

Overnight, Japan's Nikkei gained 0.4 percent Thursday after the country's central bank kept monetary policy unchanged and held its key interest rate at minus 0.1 percent, as expected. Meanwhile, China's Shanghai Composite gained 0.5 percent and Hong Kong's Hang Seng fell 1.1 percent.

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On Wednesday, the Fed cut its benchmark interest rate by 25 basis points to a range between 1.75 percent and 2 percent, citing weakening exports and low inflation. Fed Chairman Jerome Powell said at a press conference following the decision that the central bank will "act as appropriate to ensure that the expansion remains on track."

FOX Business' Ken Martin contributed to this report.