UKX FTSE 100 Index

By Max Bernhard 

U.S. stocks inched lower Friday, but major indexes were still poised to close the week with gains after a strong kickoff to corporate earnings season and an easing of trade tensions with China.

The S&P 500 slipped 0.3% but is still poised for a 0.8% gain for the week, powered by upbeat quarterly earnings reports from banks like JPMorgan Chase and Citigroup and hopes that the trade dispute with China is on its way to being resolved.

The Dow Jones Industrial Average ticked down 0.3% in morning trading, while the Nasdaq Composite fell 0.5%. All three indexes are within 2.5% of all-time highs.

Johnson & Johnson slumped 3.3%, weighing on the Dow, after the company said it was recalling a single lot of its Johnson's Baby Powder after tests found the small amounts of chrysotile asbestos contamination.

Shares in Coca-Cola, another Dow component, jumped 1.8% following higher sales posted by the beverage giant.

"Some of the headwinds around concerns of a slowing U.S. economy and trade tensions have slowed a bit this week," said Philip Blancato, CEO and president of Ladenburg Thalmann Asset Management.

Overseas, Chinese stocks dropped sharply on Friday after data showed the Chinese the economy slowed further in the third quarter, adding to concerns about global growth. President Trump has said he could sign a "phase one" deal with his Chinese counterpart Xi Jinping in November.

The benchmark Shanghai Composite Index fell 1.3%, its biggest decline in a month. Fresh data showed that China's economy grew 6% in the quarter as business activity continued to deteriorate in the world's No. 2 economy. Each quarterly slowdown in growth has pulled the economic performance to new lows not seen since the current measure of output was adopted in 1992.

"The figures are painting markets in red today," said Ipek Ozkardeskaya, a senior analyst at London Capital Group. "Pulling below 6% would be really bad for investor sentiment, not only in China, but globally."

The benchmark Stoxx Europe 600 fell 0.4%. In the U.K., the FTSE 100 dropped 0.3% and the pound wavered between gains and losses against the U.S. dollar.

Investors are watching developments closely before U.K. lawmakers vote Saturday on a draft Brexit agreement struck with the European Union. Prime Minister Boris Johnson is trying to muster enough support for the deal in the U.K. Parliament.

Write to Max Bernhard at Max.Bernhard@dowjones.com

(END) Dow Jones Newswires

October 18, 2019 10:56 ET (14:56 GMT)

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