Investing.com – Stocks ended the day flat as a warning from Beijing that it stands ready to respond in-kind to any U.S. tariff hikes kept a lid on buying.
The Dow Jones Industrial Average edged up 0.01%, the S&P 500 lost 0.16%, while the Nasdaq Composite fell 0.26%.
China’s commerce ministry said it will take "necessary retaliatory measures" if the U.S. moves ahead with plans to raise tariffs on Friday, raising some doubts over President Donald Trump's message that the Chinese trade team was looking to make a deal at talks set for this week.
Trump tweeted that Chinese negotiators "just informed" the White House they are "coming to the U.S. to make a deal" on trade.
Analysts said that the rhetoric on trade will be ramped up heading into the final stages of the talks, but ultimately cooler heads will prevail and a deal will be struck.
"(W)e believe an agreement will be reached soon, even if the rhetoric is ratcheted up even further over the next few days and the U.S. increases tariffs temporarily," Pantheon Macroeconomics said in a note.
Trade-sensitive stocks like Boeing (NYSE:BA) and Caterpillar (NYSE:CAT) ended the day mixed, suggesting market participants are not yet convinced that an escalation in U.S.-China trade tensions will be averted.
Energy stocks closed roughly flat, even as U.S. oil prices settled higher on the back of an unexpected draw in domestic supply.
Falling tech stocks also kept a lid on gains, as chip stocks continued to sell off after Intel (NASDAQ:INTC) said it expects low-single-digit revenue growth over the next three years. Its shares dropped 2.5%.
Consumer discretionaries were victim to quick-fire selling in Amazon moments before the close on reports cyber criminals had hacked and siphoned funds from seller accounts on the e-commerce platform over six months last year. Amazon.com (NASDAQ:AMZN) ended day down 0.17%.
Consumer staples, meanwhile, were pressured by a slump in Coty (NYSE:COTY) after the beauty company reported a mixed fiscal third quarter, missing on the top line, but beating Investing.com's consensus on the bottom line.
Top S&P 500 Gainers and Losers Today:
Diamondback Energy (NASDAQ:FANG), Fleetcor Technologies (NYSE:FLT) and McKesson (NYSE:MCK) were among the top S&P 500 gainers for the session.
TripAdvisor (NASDAQ:TRIP), DaVita HealthCare (NYSE:DVA) and Marathon Petroleum (NYSE:MPC) were among the worst S&P 500 performers of the session.