The three main stock indices were down more than 1% intraday, but they recovered after President Donald Trump told reporters that he would be meeting with Chinese officials later in the day and that a deal was possible.
The tech sector, which is closely tied to trade relations with China, fell 0.7%. Blue-chip Intel (INTC) dropped 5.3% while Seagate Technology (STX) fell 3%. Microchip Technology (MCHP) lost 2.4%.
Materials led market decliners, losing 0.8%. Applied Materials (AMAT) slipped 1.5% while Celanese (CE) lost 2%. DowDuPont (DWDP) fell 2.2%.
Chevron (CVX) closed up 3.1% after it announced it would not raise its bid for Anadarko Petroleum (APC) after that company agreed to a higher offer from Occidental Petroleum (OXY). Chevron said it would use the $1 billion breakup fee it is owed from Anadarko to raise its share-buyback program. Anadarko lost 3.3% while Occidental dropped 6.4%.
Tapestry (TPR) jumped 8.5% as the luxury-goods retailer announced a $1 billion share-repurchase program after it posted mixed quarterly results.
Stamps.com (STMP) lost almost 56% after the online postage company cut its full-year guidance.
Keurig Dr Pepper (KDP) lost 2.9% after the beverage company's net sales declined in the first quarter.
In economic news, the US posted a moderate increase in its goods and services deficit for March as merchandise imports rose. The deficit stood at $50 billion in March, up $0.7 billion from the revised reading of $49.3 billion in February.
Producer prices accelerated by less than expected in April, with the headline results coming in below analysts' expectations on slower growth in final demand goods and services, the Labor Department said.
Meanwhile, the number of claims filed by Americans for first-time unemployment benefits fell less than expected last week, while continuing claims at the end of April increased.
The Dow Jones Industrial Average lost more than 0.5% while the Standard & Poor's 500 slipped 0.3%. The Nasdaq Composite fell 0.4%.
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