US stocks fell on Thursday as conflicting tones surrounding a possible trade deal between the United States and China eclipsed strong earnings reports from Apple and Facebook.
Mixed signals around trade gave investors reason for caution after a Bloomberg report said Chinese officials have doubts about whether it is possible to reach a comprehensive long-term trade deal with Washington and US President Donald Trump.
But Trump later said the two countries would soon announce a site where a "Phase One" trade deal will be signed after Chile canceled a planned summit set for mid-November that was to be the venue for a signing.
The decline was the second for the S&P 500 in the past seven days, after the benchmark index notched intraday record highs in the past three sessions and a closing record in two of the past three days.
"They rallied this market so much in anticipation of not only the trade deal - but interest rates and everything else -
this market would come in very quickly if in fact, word got out the Chinese are completely walking away," said Ken Polcari, senior market strategist at SlateStone Wealth LLC in Jupiter, Florida.
"Today's action, with the market down, is absolutely nothing for anyone to get super concerned about because after the rally we have had for two weeks, you have to suspect at some point the market has to back off a little bit."
The trade-sensitive industrials sector lost 1.14%, while China-exposed chipmakers also fell, sending the Philadelphia Semiconductor index down 0.62%.
However, corporate earnings were a bright spot. Apple Inc rose 2.26%
after the iPhone maker forecast sales for the holiday shopping quarter ahead of expectations.
Facebook Inc gained 1.81% after reporting an uptick in users in lucrative markets and its third straight rise in quarterly sales growth.
The Dow Jones Industrial Average fell 140.46 points, or 0.52%, to 27,046.23, the S&P 500 lost 9.21 points, or 0.30%, to 3,037.56 and the Nasdaq Composite dropped 11.62 points, or 0.14%, to 8,292.36.
Earnings for the quarter are now expected to decline 0.8%, according to Refinitiv data, an improvement from the 2.2% decline expected at the start of the month.
Data on Thursday showed a marginal rise in consumer spending in September, casting doubts on consumers' ability to continue driving the economy, a key pillar of the current economic environment.
The Labor Department's October jobs data on Friday will be closely watched after the Fed signaled on Wednesday there would be no further cuts unless the economy takes a negative turn.
Among other stocks, Estee Lauder Cos Inc fell 3.62% after the cosmetics maker cut its forecast for full-year profit.
Kraft Heinz Co jumped 13.44% as the packaged foods company said it was spending more on marketing key brands next year, after reporting a better-than-expected third-quarter profit.
Declining issues outnumbered advancing ones on the NYSE by a 1.66-to-1 ratio; on Nasdaq, a 1.67-to-1 ratio favored decliners.
The S&P 500 posted 26 new 52-week highs and 5 new lows; the Nasdaq Composite recorded 71 new highs and 83 new lows.