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U.S. stock indexes edged lower in afternoon trading Monday as investors waited for the latest updates about trade negotiations and the economy.
Health care and technology stocks accounted for much of the selling. Those losses outweighed gains in companies that rely on consumer spending and communication services stocks.
Wall Street is particularly focused on developments in the trade war ahead of a new round of tariffs on $160 billion of Chinese imports due to take effect on Sunday. That would raise prices on key products, including cell phones and laptops, and threaten to affect consumers.
A Chinese official said Monday that the nation wants a prompt settlement, but gave no details on progress toward a potential deal. China made a conciliatory gesture last week when it said it would waive tariffs on American soybeans and pork.
The yield on the 10-year Treasury fell to 1.82% from 1.84% late Friday. Banks fell as bond yields declined. Wells Fargo dropped 0.6%.
KEEPING SCORE: The S&P 500 index fell 0.2% as of 1:25 p.m. Eastern time. The Dow Jones Industrial Average fell 72 points, or 0.3%, to 27,942. The Nasdaq fell 0.2%. The Russell 2000 index of smaller company stocks was unchanged.
European markets edged lower and Asian markets rose.
BIG PHARMA GOES SHOPPING: Several old-guard drug developers made billion-dollar purchases to beef up their development of potential cancer treatments.
Merck is spending $2.7 billion for ArQule, a small biotechnology company that is still in the earlier stages of studying potential treatments for conditions including leukemia. ArQule’s stock doubled following the announcement and Merck fell slightly.
Sanofi is making a similar play, spending $2.5 billion for Synthorx, which is also in the earlier stages of testing treatments. Sanofi slipped 1.4% and Synthorx more than doubled.
DISCOUNT DRUGS: Health insurer United HealthCare is buying Diplomat Pharmacy to help bolster its pharmacy benefits unit, OptimRx. The deal is being made at a steep discount, which sent Diplomat’s stock plunging 32.2%, while UnitedHealth barely budged.
WEEK AHEAD: Wall Street is in for a busy week of economic reports culminating in a key update on whether Americans are still spending at a healthy pace.
Investors will get a revised report on worker productivity for the July-September quarter on Tuesday. Data released in November showed a decline for the first time since late 2015.
On Wednesday the government will release its November report for consumer prices, which have been rising at a modest rate this year. A gauge on producer prices will be released on Thursday.
The Commerce Department’s report on retail sales coming up Friday is possibly the most important update this week. The economy has been propped up in part by solid spending and job growth.
FED WATCH: The Federal Reserve is meeting this week to discuss monetary policy but is widely expected hold off on making any changes. The central bank has cut interest rates three times this year in a sharp reversal from 2018 in an effort to buttress economic growth.
The rate cuts have injected more confidence into the market. The Fed has signaled that it will hold off on any additional rate cuts as long as the economy remains healthy.
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AP Business Writer Damian J. Troise contributed.