(Reuters) - U.S. stock indexes were trading lower on Thursday, as a batch of weak quarterly reports dampened a robust earnings season and trade tensions rose on news the European Union may retaliate if United States slaps tariffs on EU cars.
FILE PHOTO: Traders work on the floor of the New York Stock Exchange (NYSE) in New York, U.S., July 16, 2018. REUTERS/Brendan McDermid
EU Trade Commissioner Cecilia Malmstrom said she hoped a mission to Washington would ease the trade dispute that started after the United States imposed tariffs on EU steel and aluminum on June 1, with President Donald Trump threatening to extend them to cars and auto parts.
“Today’s theme is trade war, as the EU is going to retaliate against car tariffs and that is going to weigh,” said Peter Cardillo, chief market economist at Spartan Capital Securities in New York.
“The market is probably going to be defensive even though we are getting good news on the economy and as earnings continue to pour in.”
Concerns about the impact of tariffs have been rising among manufacturers in every one of the Federal Reserve’s 12 districts, a central bank report released on Wednesday showed.
However, White House trade adviser Peter Navarro on CNBC downplayed tariff-related concerns, saying President Trump’s trade strategy with China, which includes levying new tariffs, is not as disruptive as many describe.
The Consumer Staples sector .SPLRCS dropped 0.9 percent, the most among the 11 main S&P sectors.
The losses on the sector were led by a 6.3 percent drop in shares of cigarette maker Philip Morris after the company lowered full-year profit forecast. Rival Altria (MO.N) dropped 3.3 percent.
EBay (EBAY.O) sank 9.6 percent, the most on the benchmark S&P 500
