U.S. stocks erased deep losses to end the day mixed as White House officials left open the possibility that President Donald Trump's tariff proposals will spare neighbors from the most severe penalties. The dollar and Treasuries erased gains.
The S&P 500 index was little changed after falling as much as 1 percent during a session marked by thin trading. Investors spooked by the departure of pro-trade adviser Gary Cohn took solace in comments from White House Council of Economic Advisers Chairman Kevin Hassett that indicated the trade policy is not yet finalized.
Trade angst still set the tone in U.S. equities, with multinationals in the Dow Jones Industrial Average leading declines, while domestically focused small caps paced gains. Treasuries pared an advance to trade little changed, while Bloomberg's dollar index fell versus the Canadian dollar after White House spokesman Sarah Sanders said "there are potential carve-outs" for Canada in the coming tariffs.
The Nasdaq composite gained 24.64 points, or 0.3 percent, to 7,396.65. The Russell 2000 index of smaller-company stocks added 12.33 points, or 0.8 percent, to 1,574.53. It's fared better than the S&P and Dow over the past week as the companies on that index are far more U.S.-focused and would stand to lose less from a flare-up in global trade tensions.
Elsewhere, crude fell toward $61 a barrel in New York. Investors also have their sights fixed on upcoming central bank decisions in Europe and Japan, ahead of Friday's U.S. jobs report.
"I think markets are taking a wait and see attitude. But I do believe markets will sell off a lot more if it becomes clear that we are going to start tariffs." Chris Zaccarelli, chief investment officer of the Independent Advisor Alliance, said by phone. "And if other countries are going to retaliate and people start to wonder how far this is going to go, I think that then there will be more of an impact on the market."
Industrial companies like Caterpillar and Boeing whipsawed on the news. Technology and health care companies ended higher, while energy companies fell with oil prices.
In response to the planned steel and aluminum tariffs, the European Union has proposed tariffs on U.S. exports including motorcycles and bourbon. Jack Daniel's maker Brown-Forman sank after Chief Executive Officer Paul Varga said his company "could be an unfortunate and unintended victim" of more hostile trade. Varga said the company has been selling more lower-priced liquors in Europe, a strategy that leaves it more vulnerable to higher costs.
The company also forecast a smaller-than-expected annual profit and its stock dropped $3.15, or 5.6 percent, to $52.89. Motorcycle maker Harley-Davidson slid 43 cents, or 1 percent, to $43.90.
Discount retailer Dollar Tree's fourth quarter results disappointed investors, and so did its forecasts for the current year. It tumbled $15.11, or 14.5 percent, to $89.25. Competitor Ross Stores lost $5.11, or 6.3 percent, to $75.40 following its report.
Benchmark U.S. crude dropped $1.45, or 2.3 percent, to $61.15 a barrel in New York after the Energy Department reported that U.S. oil production rose last week. Brent crude, used to price international oils, fell $1.45, or 2.2 percent, to $64.34 a barrel in London. Exxon Mobil tumbled $1.92, or 2.5 percent, to $74.26 and Hess lost $2, or 4.1 percent, to $46.48.
Information for this article was contributed by Randall Jensen of Bloomberg News and Marley Jay of The Associated Press.
Business on 03/08/2018