Stocks fall; Trump turns attention to trade war

U.S. stocks dropped and the dollar rallied the most in two weeks as the trade dispute with China showed no signs of easing.

The S&P 500 Index edged lower for a second day as trade-sensitive stocks paced declines, while a rally in tech shares helped mute the benchmark’s drop. President Donald Trump signaled Thursday he’d press on with the trade war. Low-level delegates from China and the U.S. are wrapping up two days of trade talks as the nations hit each other with new levies on $16 billion of goods.

The dollar rose for the first time in six days, pressuring commodity prices on products from copper to soybeans..

Trade remains in the spotlight after the U.S. and China levied more duties, while Mexico appears close to an agreement on Nafta. And in the background., investors are left to wonder how the political drama in Washington may impact negotiations. All of this could get pushed aside at the end of the week as traders look for hints on the future of monetary policy during a gathering of central bankers in Jackson Hole, Wyoming.

“One of the bigger risks that we keep watching is the trade talks with China. The fact that there’s still discussions going on is good and the fact that both sides are still willing to negotiate is good, but I don’t think that there’s going to be anything monumental that’s going to happen before the midterm elections,” Liz Young, senior investment strategist at BNY Mellon Investment Management, said.