By Anna Isaac and Caitlin Ostroff 

U.S. stocks edged down Thursday as investors assessed conflicting signals on prospects for the U.S.-China trade talks.

The Dow Jones Industrial Average dropped 0.2%, a day after the gauge of U.S. blue-chip stocks logged its biggest fall of the month. The S&P 500 fell 0.2%, and the Nasdaq Composite also inched down 0.2%. All three major U.S. indexes reached all-time highs earlier this week.

China's chief trade negotiator late last week invited his American counterparts for a new round of face-to-face talks, according to people briefed on the matter, The Wall Street Journal reported Thursday. Chinese officials hope the negotiations can take place before the Thanksgiving holiday, but the U.S. side hasn't committed to a date.

That report came less than a day after President Trump criticized China's efforts to reach a trade agreement, escalating concerns that the world's two biggest economies won't reach a deal this year.

"The market really doesn't know what leg to stand on at this stage," said Ole Hansen, head of commodity strategy at Saxo Bank. "We have this roller coaster, or hamster wheel, on trade."

Overseas, the pan-continental Stoxx Europe 600 index retreated 0.5%, led by losses in sectors most exposed to the global economic impact of worsening trade tensions.

Investors who parsed Federal Reserve meeting minutes released Wednesday found central bank officials said little about what would prompt them to resume interest-rate cuts when they signaled a pause following last month's rate reduction.

"Markets have been climbing on hopes of a trade resolution and easier monetary policy," said Russ Mould, investment director at asset-management company AJBell. "Now the trade news was negative overnight from China, and the Fed minutes were disappointing insofar as they signaled a wait-and-see approach."

Adding to strains between the two nations, Beijing on Wednesday summoned the highest-ranking U.S. diplomat in the capital to object to Washington's support for Hong Kong protesters after the House of Representatives passed legislation Wednesday requiring the U.S. to re-examine its relationship with Hong Kong. That put formal American support for the pro-democracy protests in the hands of Mr. Trump.

The health of the U.S. economy has been a focus of investors, and a recent drive into shares of economically sensitive companies, like banks and manufacturers, has suggested optimism about the economic outlook. New data Thursday showed the number of Americans applying for first-time unemployment benefits held steady at a near five-month high last week, above the level expected by economists surveyed by The Wall Street Journal.

The yield on the benchmark 10-year U.S. Treasury was 1.767%, up from 1.737% Wednesday. Bond yields rise as prices fall.

Company-specific news drove swings in individual stocks. Shares in Charles Schwab jumped 6.6% after CNBC reported that the brokerage is in talks to buy TD Ameritrade Holding and a deal could be announced as early as Thursday. TD Ameritrade surged 14%. Rival E*Trade Financial dropp 6.8%.

Shares of Tiffany rose 2.4% following a Reuters report that LVMH Moët Hennessy Louis Vuitton SE has gained access to the jewelry retailer's books after it improved its takeover offer to nearly $16 billion.

--Karen Langley and Joanna Chiu contributed to this article.

Write to Anna Isaac at anna.isaac@wsj.com and Caitlin Ostroff at caitlin.ostroff@wsj.com

(END) Dow Jones Newswires

November 21, 2019 10:25 ET (15:25 GMT)

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