Wall Street falls as Trump greenlights China tariffs

US stocks fell back on Friday after President Donald Trump instructed aides to proceed with tariffs on about $200 billion in Chinese products, despite Treasury Secretary Steven Mnuchin's attempts to restart talks with Beijing.

A source familiar with the situation confirmed stories initially carried by both Bloomberg and Fox News on the moves by the White House.

Wall Street, which had been trading marginally in positive territory on the back of a rise in US Treasury yields above 3 per cent, reversed. 

"If Trump is willing to go ahead with the tariffs then that is significant enough to sour markets," said Bryan Reilly, managing director at CIBC Private Wealth Management in Boston, Massachusetts.

"Should this trade uncertainty prevail, then sentiment only has one way to go from here and that is down."

At 12:39am ET the Dow Jones Industrial Average fell 0.17 per cent to 26,102.37, the S&P 500 0.15 per cent to 2,899.71 and the Nasdaq Composite 0.26 per cent to 7,992.72.

Financial stocks held on to their gains and were last up 0.52 per cent. Only three of the 11 major S&P sectors were higher.

The real estate index fell 1.11 per cent, while utilities 0.69 per cent and telecoms declined 0.77 per cent.

Also weighing on utilities was NiSource, which tumbled 9.9 per cent after fire investigators said they suspected the company's unit, Columbia Gas, was linked to a series of gas explosions in Boston suburbs on Thursday.

The energy sector was up 0.69 per cent, making it the best performing group on the day.

Walmart dropped 0.5 per cent after Goldman Sachs raised questions around the purchase of a majority stake in India's Flipkart.

L Brands Inc. jumped 4.8 per cent after the owner of Victoria's Secret said it would close all 23 Henri Bendel stores and its website in January.

Adobe Systems rose 2.6 per cent after the company topped quarterly revenue and profit expectations.

Declining issues outnumbered advancers for a 1.18-to-1 ratio on the NYSE, but advancing issues outnumbered decliners by a 1.19-to-1 ratio on the Nasdaq.

The S&P index recorded 45 new 52-week highs and no new lows, while the Nasdaq recorded 100 new highs and 48 new lows.