Stocks face variations over comments of U.S. trade rep on trade talks

Global stock indexes were little changed on Wednesday after U.S. Trade Representative Robert Lighthizer said it was too early to predict an outcome in U.S.-China trade talks, though a drop in oil prices lifted shares of energy companies. Lighthizer also told a Congressional hearing that U.S. issues with China were "too serious" to be resolved with promises from Beijing.

Hopes for a resolution of the trade conflict had bolstered stock markets in recent sessions. U.S. President Donald Trump said on Sunday he would delay a self-imposed March 1 deadline to raise tariffs on Chinese imports after "productive" trade talks. "The general consensus is talks are progressing but it may not be full speed ahead," said Bucky Hellwig, senior vice president at BB&T Wealth Management in Birmingham, Alabama.

Equity investors also were on edge as the second U.S.-North Korean nuclear summit kicked off and tensions flared up between nuclear-armed neighbours India and Pakistan. Oil prices rallied for a second day after an unexpected decline in U.S. crude inventories and after Saudi Arabia appeared undaunted by pressure from Trump on OPEC to prevent steeper price rises.

Brent crude futures LCOc1 rose or 2.1 per cent to $66.58 a barrel, while U.S. crude rose 2.61 per cent to $56.95 per barrel. The S&P 500 energy index was up 0.9 per cent, helping to limit losses in the benchmark S&P 500 index.

The Dow Jones Industrial Average fell 63.38 points, or 0.24 per cent, to 25,994.6, the S&P 500 lost 1.86 points, or 0.07 per cent, to 2,792.04 and the Nasdaq Composite added 0.84 points, or 0.01 per cent, to 7,550.14. MSCI's gauge of stocks across the globe shed 0.07 per cent, while the pan-European STOXX 600 index lost 0.28 per cent.

Investors were keeping an eye on the U.S.-North Korean summit in Hanoi. Trump is meeting Kim Jong Un, with the United States pushing North Korea's leader to dismantle its nuclear weapons program. The U.S. dollar benefited modestly from the trade remarks, but investors also were absorbing comments from Federal Reserve Chairman Jerome Powell, who spoke for a second day before U.S. Congress. Powell has emphasized patience on raising U.S. interest rates.

The dollar index, tracking it against six major currencies, rose 0.16 per cent, with the euro down 0.17 per cent to $1.1366. U.S. Treasury yields rose in spite of a report that the U.S. goods trade deficit widened sharply in December, suggesting a slowdown in growth in the fourth quarter.

The Commerce Department said the goods trade gap jumped 12.8 per cent to $79.5 billion in December as slowing global demand and a strong dollar weighed on exports. Exports declined 2.8 per cent and imports rose 2.4 per cent Benchmark 10-year Treasury notes last fell 14/32 in price to yield 2.6843 per cent, from 2.636 per cent late on Tuesday.