The remarks were the first drastic shift in tone since Washington and Beijing stepped up negotiations last week, hoping to agree to a framework for a deal by the deadline.
Also pressuring markets was a report out Thursday that President Trump is planning to sign an executive order next week which would ban Chinese telecommunications equipment from US wireless networks. "But that is off in the distance still at the moment", he said. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. The Dow Jones Industrial Average was 0.9 percent lower at 25,169.53 and the Nasdaq composite slid 1.2 percent to 7,288.35.
U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin are leading a group of administration officials headed to Beijing next week as part of the trade talks.
"I could see where that would impact the markets because, obviously, we had a lift in the month of January from optimism surrounding these trade talks", said Peter Jankovskis, co-chief investment officer at OakBrook Investments LLC in Lisle, Illinois. President Trump has repeatedly threatened increasing tariffs on various Chinese goods imported to the United States if the two sides do not broker a permanent deal to end the standoff. The benchmark 10-year yield slid 4 basis points to 2.66 percent, the lowest in almost a week.
Investor confidence dented as it became clear that a trade meeting between President Donald Trump and Chinese President Xi Jinping would not happen before a key March deadline.
U.S. stock markets staged their first major pull-back since the news broke early January that negotiations would resume in Washington.
Last week, Chinese and USA negotiators said they made "important progress", China's state media reported following the conclusion of two days of high-level talks in Washington, DC. A senior administration official now says there's "far too much work to do" in a short period of time before a deal can get done with China.
Washington is demanding far-reaching changes from China to address unfair practices it says are deeply unfair, including theft of American intellectual property and the massive Chinese trade surplus.
China has retaliated with tariffs of its own, but has suspended some and is allowing some purchases of U.S. soybeans during the talks.
One senior official said the decision not to go ahead with a meeting should not be read as a sign the talks were breaking down.