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U.S. Stocks Finish Lackluster Session Modestly Lower

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Stocks showed a lack of direction over the course of the trading session on Monday, with the major averages bouncing back and forth across the unchanged line following the rally seen last Friday.

The major averages eventually ended the day in negative territory. The Dow fell 95.70 points or 0.4 percent to 26,478.02, the Nasdaq dipped 26.18 points or 0.3 percent to 7,956.29 and the S&P 500 slid 13.22 points or 0.5 percent to 2,938.79.

The choppy trading on Wall Street came as traders seemed reluctant to make significant moves ahead of the next round of high-level trade talks in Washington later this week.

Ahead of the talks, scheduled to begin on Thursday, a report from Bloomberg News said Chinese officials are signaling they're increasingly reluctant to agree to the broad trade deal being pursued by President Donald Trump.

Citing people familiar with the discussions, Bloomberg said senior Chinese officials have indicated the range of topics they're willing to discuss has narrowed considerably.

An offer from Chinese Vice Premier Liu He would purportedly not include reforming Chinese industrial policy or government subsidies.

The upcoming negotiations come as the trade war continues to hang over the economy, with a survey by the National Association for Business Economics showing 53 percent of economists see trade policy as the key downside risk to the economy.

The NABE said four out of five panelists believe that risks to the economic outlook are weighted to the downside, an increase from the 60 percent who held this view in June.

"The panel turned decidedly more pessimistic about the outlook over the summer, with 80% of participants viewing risks to the outlook as tilted to the downside," said Survey Chair Gregory Daco, chief U.S. economist at Oxford Economics.

He added, "The rise in protectionism, pervasive trade policy uncertainty, and slower global growth are considered key downside risks to U.S. economic activity."

Sector News

Most of the major sectors showed only modest moves on the day, contributing to the lackluster performance by the broader markets.

Natural gas stocks showed a significant move to the downside, however, with the NYSE Arca Natural Gas Index sliding by 1.3 percent.

The weakness among natural gas stocks came amid a decrease by the price of the commodity, as natural gas for November delivery fell $0.049 to $2.303 per million BTUs.

Steel, oil service and gold stocks also saw notable weakness on the day, while modest strength was visible among telecom stocks.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance on Monday, with markets in China closed for a holiday. Japan's Nikkei 225 Index dipped by 0.2 percent, while Australia's S&P/ASX 200 Index climbed by 0.7 percent.

Meanwhile, the major European markets all moved to the upside on the day. While the German DAX Index advanced by 0.7 percent, the U.K.'s FTSE 100 Index and the French CAC 40 Index both rose by 0.6 percent.

In the bond market, treasuries gave back ground after moving sharply higher over the past several sessions. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, rose by 3.8 basis points to 1.553 percent.

Looking Ahead

A report on producer price inflation may attract attention on Tuesday along with remarks by Federal Reserve Chairman Jerome Powell.

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