US stock indexes have fallen as weak results from CSX stoked concerns that the protracted trade war between the United States and China could hurt corporate earnings.

CSX shares tumbled 10.3 per cent, their biggest one-day drop since 2008, after the rail freight company posted lower-than-expected quarterly profit and cut its full-year revenue forecast.

Ongoing trade tensions have contributed to a decline in truck and rail freight volumes in the first half of 2019.

CSX was one of the biggest drags on the S&P 500 index, along with Union Pacific and Berkshire Hathaway, which owns BNSF Railway.

Union Pacific, whose shares dropped 6.1 per cent, reports results on Thursday.

The losses in shares of rail companies helped push down the S&P 500 industrials index, whose 2.2 per cent slide was the largest among the S&P’s 11 major sectors. The Dow Jones Transportation Average fell 3.6 per cent on Wednesday.

The Federal Reserve’s Beige Book, a compendium of anecdotes from US businesses, also pointed to trade-related pressures on transportation and manufacturing companies.

Stephen Carl, principal and head of US equity trading at the Williams Capital Group in New York, said the trade concerns were an uncertainty.

“It could be a huge negative impact. Costs are going to be coming from higher tariffs,” he said.

Ed Campbell, portfolio manager and managing director at QMA in Newark, New Jersey, said persistent trade-related concerns were a critical factor supporting expected interest rate cuts from the Federal Reserve later this month.

The anticipation of rate cuts has helped propel US stocks to new highs in the past week.

“One of the things Trump is doing with trade is he’s using it as a cudgel against the Fed,” Campbell said.

“The Fed is citing uncertainty relating to trade as a reason they’re open to cutting rates.”

The Dow Jones Industrial Average fell 115.78 points, or 0.42 per cent, to 27,219.85, the S&P 500 lost 19.62 points, or 0.65 per cent, to 2984.42 and the Nasdaq Composite dropped 37.59 points, or 0.46 per cent, to 8185.21.

Bank of America rose 0.7 per cent after posting a profit beat, though the company lowered its annual net interest income forecast.

Netflix shares tumbled in aftermarket trade after the company reported quarterly results. They were last down nearly 11 per cent.

Profit for S&P 500 companies is expected to rise 0.4 per cent in the second quarter from a year ago, according to Refinitiv IBES data.

Abbott Laboratories shares rose 3.1 per cent after the medical device maker topped quarterly profit estimates and lifted its full-year adjusted earnings forecast.

Declining issues outnumbered advancing ones on the NYSE by a 1.67-to-1 ratio; on Nasdaq, a 1.73-to-1 ratio favoured decliners.

The S&P 500 posted 25 new 52-week highs and three new lows; the Nasdaq Composite recorded 58 new highs and 86 new lows.

Volume on US exchanges was 6.1 billion shares, compared to the 6.66 billion average for the full session over the last 20 trading days.