By Paul J. Davies and Karen Langley 

U.S. stocks hovered around the flatline Thursday as investors parsed the latest headlines on the trade dispute with China and looked ahead to Friday's jobs report.

The S&P 500 and the Dow Jones Industrial Average edged up less than 0.1%, while the Nasdaq Composite inched down less than 0.1%.

Trade-related news has driven markets this week. China again offered reassurance Thursday on the state of trade talks between the world's two largest economies, with a spokesman for China's Commerce Ministry saying the negotiating teams have maintained close communications.

That followed comments from President Trump who had suggested earlier in the week that the talks could continue well into next year, spooking investors and pushing major indexes lower. Mr. Trump then later said the talks were going "very well."

Investors have been watching the negotiations particularly closely with the approach of the next wave of proposed tariff increases, which are due to go into effect Dec. 15.

"I think you'll see more volatility around trade war coming up as this December 15 deadline looms," said Sandy Villere, portfolio manager at the Villere Balanced Fund.

Mr. Villere said he has watched trade-related market drops for opportunities to buy particular stocks whose prices have been pushed down. His fund added shares of ON Semiconductor earlier this year.

And Sébastien Galy, senior macro strategist at Nordea Asset Management, speculated that by the end of next week, "Trump will be willing to say that tariff increases are unnecessary because talks have progressed."

Meanwhile, fresh economic data Thursday showed the number of Americans applying for first-time unemployment benefits fell last week, declining to a level lower than that expected by economists surveyed by The Wall Street Journal.

Investors will closely watch Friday's nonfarm payrolls data for additional insights into the health of the U.S. jobs market. The employment figures could turn weaker given the slowdown in corporate investment spending and the weakening in new job openings reported earlier this week.

"It's possible we start to see an easing in the jobs market," Mr. Galy said.

As broad stock indexes showed muted moves, earnings reports drove swings in individual stocks. Shares of fashion retailer Express jumped 27% after it reported third-quarter sales that beat expectations. Shares of Five Below rose 3.3% after the discount retailer beat estimates for the third quarter.

Michaels shares fell 12% after the crafts retailer reported a drop in profit.

Among the sectors in the S&P 500, materials, technology and financials led the way, while shares of consumer-staples and energy companies lost ground.

In Asia, the Hang Seng Index gained 0.6%, while the Shanghai Composite rose 0.7%.

The British pound continued its rally of recent days on rising expectations of a Conservative Party victory in next week's general election. The pound gained 0.4% to trade at $1.316, putting it on track for its highest close since May.

The yield on the benchmark 10-year Treasury was 1.800%, up from 1.781% Wednesday.

Write to Paul J. Davies at paul.davies@wsj.com and Karen Langley at karen.langley@wsj.com

(END) Dow Jones Newswires

December 05, 2019 14:30 ET (19:30 GMT)