A valiant attempt by the bulls fell short, as U.S. equities finished in negative territory, albeit well off the lows of the session after a late day push higher, after President Trump dimmed hopes for a near-term trade deal with China, while also indicating that upcoming trade talks in September may be cancelled. Earnings and economic data were also in focus, as Uber Technologies, Activision Blizzard and CBS all posted quarterly results, and July core wholesale price inflation came in a bit cooler than expected. Treasury yields reversed upward to finish higher and the U.S. dollar dipped, while gold was lower in choppy trading, and crude oil prices gained ground.

The Dow Jones Industrial Average (DJIA) declined 91 points (0.3%) to 26,287, the S&P 500 Index decreased 19 points (0.7%) to 2,919 and the Nasdaq Composite fell 80 points (1.0%) to 7,959. In moderate volume, 785 million shares were traded on the NYSE and 2.2 billion shares changed hands on the Nasdaq. WTI crude oil moved $1.96 higher to $54.50 per barrel and wholesale gasoline was up $0.02 at $1.67 per gallon. Elsewhere, the Bloomberg gold spot price lost $3.78 to $1,497.17 per ounce, and the Dollar Index—a comparison of the U.S. dollar to six major world currencies—shed 0.1% to 97.53. Markets were lower for the week, as the DJIA decreased 0.8%, the S&P 500 Index fell 0.5% and the Nasdaq Composite declined 0.6%.

The Producer Price Index (PPI) showed prices at the wholesale level in July rose 0.2% month-over-month (m/m), in line with the Bloomberg forecast, and slightly above June’s unrevised 0.1% rise. However, the core rate, which excludes food and energy, dipped 0.1% m/m, versus expectations calling for a 0.1% increase and compared to June’s unadjusted 0.3% gain. Y/Y, the headline rate was 1.7% higher, matching projections and June’s increase. The core PPI rose 2.1% y/y last month, south of estimates calling for it to match June’s unrevised 2.3% gain. The m/m dip in core wholesale price inflation, which was the first since February 2017, likely came amid the recent rally in the U.S. dollar and as prices for truck transportation of freight declined.

Treasuries reversed course to finish lower, as the yield on the 2-year note and the 30-year bond gained 2 basis points (bps) to 1.63% and 2.26%, respectively, and the yield on the 10-year note increased 3 bps to 1.74%. The U.S. dollar was modestly lower and gold ended in negative territory in choppy action amid renewed trade tensions between the U.S. and China, exacerbated by comments from President Trump that dampened hopes of any near-term success in reading a deal, as well as floating the notion that talks scheduled between the two nations in September could be cancelled.

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