US STOCKS-S&P pauses with trade talks in focus; Nasdaq set to end 5-day rally

The S&P 500 hovered near six-month highs on Thursday, with losses in technology stocks countered by gains in Boeing Co and Facebook Inc, as investors waited for more clarity on the U.S.-China trade talks.

Negotiations continued in Washington after meetings last week in Beijing, as the two countries worked toward resolving their long-standing trade dispute which has cast a shadow over global economic growth. President Donald Trump is set to meet Vice Premier Liu He, who is leading the Chinese side in the talks, later on Thursday.

"The market is taking a breather today. It's in a kind of wait-and-see period after a week of strong rally," said Paul Brigandi, head of trading at Direxion Funds in New York. "We're awaiting some more details on the U.S.-China negotiations and we're awaiting the jobs report. That's giving people reason to wait and see what the next steps are."

Investors will get a clearer picture of the strength in the labor market on Friday, when the non-farm payrolls report is expected. Hopes of a trade deal have driven the S&P 500 to a strong start since the beginning of the quarter and it has closed higher all of this week. The index is near its highest since Oct. 10 and 2% away from hitting an all-time high.

Dampening the mood further were worries of a global economic slowdown as data earlier in the day showed German industrial orders in February fell at their sharpest rate in more than two years. The numbers from Europe's biggest economy follows disappointing U.S. services sector activity and private payrolls data on Wednesday.

At 1:04 p.m. ET the Dow Jones Industrial Average was up 88.85 points, or 0.34%, at 26,306.98, the S&P 500 was down 2.68 points, or 0.09%, at 2,870.72 and the Nasdaq Composite was down 33.72 points, or 0.43%, at 7,861.83. The Nasdaq was on track to end a five-day run of gains, pressured by a fall in the shares of Microsoft Corp and Tesla Inc.

Tesla tumbled 8.14% after the electric carmaker's deliveries fell 31% in the first quarter on challenges in shipping to Europe and China. Seven of the 11 major S&P sectors were higher. The technology sector fell 0.87%.

Facebook rose 1.42%, lifting the communication services sector by 0.46%, after brokerage Guggenheim upgraded the social media company's stock to "buy" from "neutral". Boeing climbed 2.47%, contributing the most to gains on the Dow and the S&P industrial index, which rose 0.4%.

Ethiopian investigators urged Boeing to review its flight control technology in the first public findings on the March crash of a 737 MAX jet. A Morgan Stanley analyst said the report potentially took the worst case scenario of an entirely new cause off the table.

Advancing issues outnumbered decliners for a 1.37-to-1 ratio on the NYSE and a 1.07-to-1 ratio on the Nasdaq. The S&P index recorded 16 new 52-week highs and one new low, while the Nasdaq recorded 40 new highs and 26 new lows. (Reporting by Sruthi Shankar and Shreyashi Sanyal in Bengaluru; Editing by Shounak Dasgupta)