US stocks trending lower, focus remains on earnings/trade tensions

Major US equity indices took a brief pause on Thursday and held on the defensive note as investors absorbed a raft of largely positive corporate earnings.

Today's weaker trading session comes on the back of recent rally, wherein the blue-chip Dow Jones Composite Index logged its longest winning streak in two months and tech-heavy Nasdaq jumped back closer to all-time highs.

Meanwhile, worries about a potential trade war rose again on news the European Union may retaliate if the US slaps tariffs on EU cars and held back bullish investors from placing any fresh bets, which could be one of the key factors contributing to the early weakness. 

Adding to this, the ongoing downfall in oil prices, with WTI crude oil falling to near one-month low weighed on energy stocks and further collaborated to the muted action during the opening hour of trade. 

On the economic data front, the Philly Fed manufacturing Index climbed more than expected to 25.7 in July and the initial weekly jobless claims dropped to their lowest level since late 1969, albeit did little to provide any bullish impetus.

With corporate earnings growth exceeding market expectations, investors might now be willing to take more risk and should thus, help limit any sharp declines in the near-term.