"The focus has been back on tariffs," said Michael Hans, CIO at Clarfeld Financial Advisors. "After a pretty substantial move higher, the major averages have been pretty range bound."
"This is a bit of a consolidation period after a sharp move higher," Hans said.
The major indexes have been under pressure this week. The Nasdaq reached record highs earlier in the week, but is down 0.4 percent week to date. Meanwhile, the Dow and S&P 500 are down 2.5 percent and 1.1 percent, respectively, for the week.
Simmering tensions between the U.S. and China on trade have kept stocks under pressure this week, with the Trump administration threatening to slap tariffs on $200 billion worth in Chinese goods. China, meanwhile, said this thread violates previous negotiations and consensus reached between both countries.
"While I suppose no one wins a trade war, the U.S. is currently 'losing less' in its current dispute with China if one uses the respective stock markets as a guide. While the S&P 500 largely stands in place and resides well above its correction bottom from earlier in the year, the Shanghai Composite has tumbled to a twenty-three month low," said Jeremy Klein, chief market strategist at FBN Securities.
"This divergence should give Washington a bit more leverage in the negotiations and ultimately will lead to a workable solution for both sides," Klein said.
Automakers fell on Thursday, with General Motors, Ford Motor, and Fiat Chrysler all sliding at least 1.5 percent. The move lower followed a profit warning from German car manufacturer Daimler, which said its bottom line could be affected by the U.S.-China trade tensions.
"We view this in the context of a strong global economic backdrop," said Bill Northey, senior vice president at U.S. Bank Wealth Management. "The risks to that have fallen in the policy realm, whether they're inflection points in monetary policy, ... trade or fiscal policy."
"These [risks] have all had their turn in the spotlight and now it's trade's turn," Northey said. "It's hard to discern whether these are negotiation volleys or something that may come to fruition at this point."
Caterpillar and Boeing dropped 2.5 percent and 1.5 percent, respectively. Both companies are susceptible to trade tensions given their large exposure to overseas markets.
Intel shares fell 2.4 percent after CEO Brian Krzanich left the company following an internal investigation into a "consensual relationship with an Intel employee."