The major domestic equity indexes closed out the trading day on Thursday in negative territory after President Trump canceled a planned summit with North Korea’s Kim Jong Un and threatened to impose tariffs on auto imports, though losses were limited by gains in Netflix and General Electric.

Trump’s order on Wednesday for an investigation into whether vehicle and auto part imports had damaged our auto industry could further complicate trade negotiations with China and other trading partners.

Early Thursday, Trump canceled the June 12 meeting citing Pyongyang’s “open hostility,” even after North Korea followed through on a pledge to blow up tunnels at its nuclear test site.

But stocks recouped much of the day’s losses by the end of the session, and market participants said the sharp drop after the summit was canceled was a knee-jerk reaction.

A decline in energy shares following lower oil prices also weighed on the market, with the S&P energy index ending the day down 1.7 percent. On the flip side, General Electric rose 3 percent, rebounding from the previous session’s losses, and Netflix’s shares gained 1.3 percent, both helping the market.

Netflix’s market value ballooned to a record $153 billion and eclipsed Disney for the first time, making it the world’s most valuable entertainment company.

Defense stocks rose after Trump called off the North Korea meeting and warned the our military was ready in the event of any “reckless” acts by North Korea.

Ford and General Motors gained ground on the possibility of tariffs on European and Asian car imports. Shares of Fiat Chrysler fell 0.9 percent.

Approximately 6.3 billion shares changed hands on the major domestic equity exchanges, as compared to the 6.6 billion-share daily average for the past 20 trading days, according to Thomson Reuters data.

Jobless Claims Rise

New applications for U.S. unemployment benefits increased more than expected last week but continued to suggest that the labor market is tight.

The Labor Department reported Thursday morning that Initial claims for state unemployment benefits rose by 11,000 claims to a seasonally adjusted 234,000 claims for the week ended May 19.

Claims have been below the 300,000 claims mark, which is associated with a strong jobs market, for 168 straight weeks. That is the longest such stretch since 1969, according to the Labor Department. The labor market is viewed as being close to or at full employment, with the jobless rate near a 17-1/2-year low of 3.9 percent.

The unemployment rate is within striking distance of the Federal Reserve’s forecast of 3.8 percent by the end of this year. Tightening labor market conditions and rising inflation will likely keep the Fed on track to increase interest rates next month.

The four-week moving average of initial claims, viewed as a better measure of labor market trends as it irons out week-to-week volatility, increased by 6,250 claims to 219,750 claims last week.

The claims report also indicated that the number of people receiving benefits after an initial week of aid increased by 29,000 to 1.74 million people for the week ended May 12. The four-week moving average of the so-called continuing claims fell 23,250 to 1.75 million, the lowest level since December 1973.

The continuing claims data covered the week of the household survey from which May’s unemployment rate will be calculated.

The four-week average of continuing claims fell 97,250 between the April and May survey periods. The unemployment rate fell two-tenths of a percentage point in April after being stuck at 4.1 percent for six straight months.

Shrinking labor market slack aids  expectations that wage growth will accelerate in the second half of the year.

Housing Sales Fall

Existing home sales fell during April, as an acute shortage of home inventory limited choices for potential buyers. The National Association of Realtors said existing home sales fell 2.5 percent to a seasonally adjusted annual rate of 5.46 million units last month.

The NAR attributed April’s weak sales to an “utter lack of available listings on the market to meet the strong demand for buying a home.”

Sales fell 1.4 percent on a year-on-year basis in April. April’s decline followed two straight monthly increases.

While the number of previously owned homes on the market increased 9.8 percent from the prior month to 1.80 million units in April, housing inventory was down 6.3 percent from a year ago. Supply has declined for 35 straight months on a year-on-year basis.

Houses for sale typically stayed on the market for 26 days in April, the fewest since the NAR started tracking the series in May 2011. That was down from 30 days in March and 29 days a year ago. Fifty-seven percent of homes sold in April were on the market for less than a month.

With inventory tight, the median house price increased 5.3 percent from a year ago to $257,900 in April. That was the 74th consecutive month of year-on-year price gains.

House price increases have far outpaced wage gains – annual wage growth has remained below 3 percent. And while there was no indication yet that rising mortgage rates are having an impact on home sales. However, higher borrowing costs could worsen the housing shortage.

The 30-year fixed-rate mortgage rate averaged 4.61 percent in the week ended May 17, the highest level since May 2011, according to mortgage finance agency Freddie Mac. That compared to an average of 4.55 percent in the previous week.

The weak existing home sales report came on the heels of data on Wednesday showing a 1.5 percent drop in new home sales in April. Investment in homebuilding was unchanged in the first quarter.

Given labor market strength and rising inflation, the sluggish housing market was unlikely to deter the Federal Reserve from raising interest rates next month.

Crude Down Again

The price of crude oil fell about 1 percent on Thursday, with expectations building that OPEC could wind down the output deal in place since the start of 2017, due to supply concerns with regard Venezuela and Iran.

Brent crude futures fell 61 cents, or 0.8 percent, to $79.19 a barrel by mid-morning. West Texas Intermediate (WTI) crude was down 67 cents at $71.17 a barrel, a 0.9 percent decline.

OPEC may decide in June to lift output to make up for reduced supply from Venezuela and Iran, the latter in part due to the U.S. decision to withdraw from the Iran nuclear arms control deal, OPEC and oil industry sources told Reuters.

Russian Energy Minister Alexander Novak said production cuts could be eased “softly” if OPEC and non-OPEC countries see the oil market balancing in June, the Interfax news agency reported.

Russia and Saudi Arabia have a common position on the future of the oil output cut deal, Novak told Interfax news agency, though he said the deal would stay in place for now. Russia’s Lukoil (said the deal should remain in place but needs to be altered.

Venezuela’s output has fallen to about 1.4 million barrels per day, according to OPEC secondary sources, as its economic crisis grows and state-run PDVSA struggles to pay its debts and fund operations.

Supply concerns have pushed Brent and WTI to multi-year highs, with Brent breaking through an $80 threshold last week for the first time since November 2014.

OPEC and some non-OPEC major oil producers, which are scheduled to meet in Vienna next month, previously agreed to curb their combined output by about 1.8 million bpd to boost oil prices and clear a supply glut.

Global inventories have been broadly falling, even as U.S. crude production remains strong. Domestically we produced 10.3 million bpd, a record.