US stocks finished the day in the red on Thursday as investors grew pessimistic about the likelihood of a trade pact being agreed to by the US and China.
Indeed, worries about the reunion between President Trump and Chinese president Xi Jinping on Saturday at the G20 summit weighed on the market's direction and helped to pare back Wednesday's gains stemming from dovish comments by Federal Reserve chair Jerome Powell.
Up in Canada, Toronto’s TSX bucked the trend to climb by 0.15% or 22.8 points to reach 15,194 while the Russell 2000 index of small-cap stocks shed 0.34% to hit 1,525.
1.00 PM: Wall Street dips on US-China trade jitters as US President sends out mixed messages
US stocks continued their slide midday Thursday amid jitters over US-China trade talks after President Trump said there was "a long way to go" on tariffs with China and urged companies to build products in the US to avoid them.
Investors are closely watching a meeting between Trump and Chinese leader Xi Jinping at the G20 summit on Saturday at which the leaders are expected to discuss trade.
The tech-laden Nasdaq was also off by 12.65 points, or 0.17% to 7,278.94 dragged lower by top decliners Ctrip.com International Ltd, Seagate Technology, and NetEase.
The Russell 2000 index of small-cap stocks fell by just 1.84 points, or 0.12% to hit 1,528.55.
10.00 AM: US stocks head south at open as upcoming G20 summit gains attention
US stocks slipped at the open on Thursday as markets fell back in the wake of yesterday’s surge and investors adopted a cautious approach ahead of US-China trade discussions at the G20 summit.
On Wednesday, the Dow rocketed by more than 600 points after Fed Chair Jerome Powell said he regards the central bank’s benchmark interest rate as near a neutral level where it doesn’t spark or hamper growth in the economy.
President Donald Trump and China’s leader Xi Jinping are set to discuss their differences on trade at the G-20 Summit in Argentina on Saturday.
Early in the session, the Dow Jones Industrial Average index reversed yesterday’s course to shed 66 points and hit 25,300, dragged back by Intel, Caterpillar Inc, Nike and Verizon Communications.
Elsewhere, the S&P 500 slipped by 11 points at the time of writing to 2,732 while the Russell 2000 index of small-cap stocks fell by just 1.8 points to hit 1,528.
Up in Canada, Toronto’s TSX broke with the pack to add 38 points and reach 15,209, on the back of gains from energy and materials stocks.
7:22 AM: Wall Street shares seen coming off highs despite Fed noises to temper interest rate rises
Wall Street shares are seen starting lower after the rally yesterday as the chair of the Fed Jerome Powell suggested the trajectory of interest rate rises could be tempered next year.
The Central bank had been thought to be firmly on the continued hike route, but it needs to consider how to balance economic expansion versus overheating the economy.
Stock markets in Europe are higher on Thursday morning, with the UK's FTSE 100 up 43 to 7,048 after closing negatively on Wednesday. Markets in France and Germany are also up.
In the US, the Dow Jones Industrial Index closed yesterday up over 617 points at 25,366, marking the biggest one day surge for eight months.
The Nasdaq exchange added 208 points at 7,291. The S&P 500 gained over 61 at 2,743.
In futures trade, the Dow Jones is down 87 points, while the Nasdaq is down 47 points and the S&P 500 futures are down 11.25 points.
Looking at the start of US trade, analyst Connor Campbell at Spreadex, said that the European markets' gains "face a test" in the shape of a falling Dow Jones.
"The index is expected to drop 100 points after the bell, an admittedly slight reversal when compared to Wednesday’s 500 point-plus climb," he suggested.
In Toronto, the TSX also made strong gains yesterday, closing over 227 points higher at 15,171.
In Asia, the Nikkei 225 in Japan closed up around 85 points at 22,262. The Shanghai Composite index gained around seven points at 2,608.