NEW YORK (AP) 鈥� Wall Street is more hesitant following a big two-day rally as U.S. companies continue to say uncertainty created by President Donald Trump鈥檚 trade war is scrambling their expectations for the year. The S&P 500 was flat in early trading Thursday, a cooldown following leaps on hopes that Trump was softening his approach on tariffs and his criticism of the Federal Reserve. The Dow Jones Industrial Average was down 163 points, or 0.4%, and the Nasdaq composite was up 0.4%. Companies across industries have been saying how difficult it is to give forecasts because of the on-again-off-again rollout of Trump鈥檚 tariffs.
THIS IS A BREAKING NEWS UPDATE. AP鈥檚 earlier story follows below.
The recent optimism on Wall Street dissipated early Thursday as companies continued to reassess their financial outlooks due to uncertainty over U.S. President Donald Trump's on-again-off-again tariff policies.
Futures for the S&P 500 were down 0.1% before the bell, while futures for the Dow Jones Industrial Average dipped 0.3%. Nasdaq futures were off 0.1%.
Thursday's nominal downturn in markets comes after a two-day rally that was fueled by Trump backing off and softening about trade with China.
PepsiCo fell 1% in the premarket after the beverage and snack maker lowered its full-year earnings expectations, citing increased costs from tariffs and a pullback in consumer spending. A 25% tariff on for cans is among those hitting PepsiCo and other beverage makers.
Southwest Airlines became the latest carrier to pull elements of its profit forecast over uncertainty about the economy. Its shares fell 4% before markets opened. Earlier this month, Delta Air Lines for 2025, citing similar uncertainty over tariffs and consumer spending.
Alphabet, the parent company of Google, reports its latest results after the bell Thursday.
Calling Trump鈥檚 policy announcements 鈥渉eadline turbulence,鈥� Tan Jing Yi of the Asia & Oceania Treasury Department at Mizuho Bank warned that global economies could be hurt in the long run, adding, 鈥淪entiments swing from hopes of intense relief to inflicted economic gloom.鈥�
Much of the recent market volatility is because of uncertainty about what Trump will do with his economic policies. Adding to some relief was Trump saying late Tuesday that he has 鈥渘o intention鈥� to fire of the Federal Reserve.
Trump鈥檚 tough talk had frightened investors because the Fed is supposed to act independently, without pressure from politicians, so that it can make decisions that may be painful in the short term but are best for the long term.
While a cut to interest rates by the Fed could give the economy a boost, it could also put upward pressure on inflation. Trump also said U.S. tariffs on imports coming from China could come down 鈥渟ubstantially鈥� from the current 145%.
鈥淚t won鈥檛 be that high, not going to be that high,鈥� he said.
Investors are hoping Trump would lower his tariffs after negotiating trade deals with other countries. Trump said this week that he would be 鈥渧ery nice鈥� to the world鈥檚 second-largest economy and not play hardball with Chinese President .
鈥淭here is an opportunity for a big deal here,鈥� U.S. Treasury Secretary .
France's CAC 40 and the German DAX each shed 0.2% by midday, while Britain's FTSE 100 ticked down 0.1%.
Japan's benchmark Nikkei 225 added 0.5% to finish at 35,039.15. Australia's S&P/ASX 200 rose 0.6% to 7,968.20. South Korea's Kospi lost 0.1% to 2,522.33. Hong Kong's Hang Seng declined 0.7% to 21,909.76, while the Shanghai Composite was little changed, inching up less than 0.1% to 3,297.29.
In energy trading, benchmark U.S. crude rose 74 cents to $63.01 a barrel. Brent crude, the international standard, added 70 cents to $65.88 a barrel.
The U.S. dollar slipped to 142.37 Japanese yen from 143.15 yen. The euro cost $1.1389, up from $1.1322.
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Yuri Kageyama And Matt Ott, The Associated Press
