SINGAPORE (AP) — World shares were mixed Wednesday on uncertainties over trade, as news the U.S. and China may be working to reopen trade talks was overshadowed by talk of plans for even higher tariffs on Chinese imports.

KEEPING SCORE: Britain’s FTSE 100 dropped 0.8 percent to 7,686.98 and Germany’s DAX fell 0.2 percent to 12,786.35 on Wednesday. France’s CAC 40 rose 0.6 percent to 5,517.38. Wall Street was set for a subdued open. Dow futures was 0.1 percent lower at 25,379.00. S&P 500 futures was almost flat at 2,816.70.

ASIA’S DAY: Japan’s Nikkei 225 index rose 0.9 percent to 22,746.70 and South Korea’s Kospi added 0.5 percent to 2,307.07. The Shanghai Composite index tumbled 1.8 percent to 2,824.53. Hong Kong’s Hang Seng index dropped 0.9 percent to 28,340.74. Australia’s S&P ASX 200 lost 0.1 percent to 6,275.70. Shares were higher in Taiwan, Indonesia and Singapore.

U.S.-CHINA TALKS: Bloomberg News reported, citing two people familiar with the situation, that U.S. and Chinese officials are looking for ways to reopen trade talks. Earlier this month, both nations placed import taxes on $34 billion worth of goods, and they’ve been threatening more severe measures. In another report, Bloomberg said the Trump administration will propose raising tariffs on $200 billion of Chinese imports to 25 percent, from the planned 10 percent. It cited three people familiar with internal negotiations. If proven true, negotiations may be a long-drawn affair even if both parties agree to start talking.

CHINA & JAPAN PMI: On Tuesday, private surveys showed that manufacturing was slowing in China and Japan. China’s Caixin Manufacturing purchasing managers’ index (PMI) was 50.8 in July, slightly lower than 51.0 in June. The Nikkei Japan Manufacturing PMI eased to 52.3 in July from 53.0 a month earlier. Readings above 50 indicate expansion, while lower numbers indicate contraction on the indexes’ 100-point scale.

ANALYST’S TAKE: “There were clearly some negatives for markets in news that the U.S. was planning to raise tariffs on China. Although PMI readings from China and Japan were not stunningly bad, they added to the negative turn in the region today,” Michael McCarthy, chief market strategist at CMC Markets in Sydney, said in an interview.

APPLE EARNINGS: Apple made more money from higher priced iPhones in the latest quarter, even as the number of phones it sold did not change much. Apple unit sales rose just 1 percent from a year ago, but the average selling price grew 20 percent to $724 per iPhone, up from $606 a year ago. Its stocks climbed 2.5 percent to $195.14 in aftermarket trading on Tuesday, after the company’s reported third-quarter profit and sales were better than analysts expected.

ENERGY: Benchmark U.S. crude dropped 47 cents to $68.29 per barrel in electronic trading on the New York Mercantile Exchange. It lost 2 percent to settle at $68.76 per barrel on Tuesday. Brent crude, used to price international oils, fell 34 cents to $73.87 per barrel.

CURRENCIES: The dollar rose to 112.02 yen from 111.83 yen. The euro slipped to $1.1683 from $1.1697.

___ – Here are the top five things you need to know in financial markets on Wednesday, August 1:

1. Markets Await Fed Policy Statement

The Federal Reserve is expected to keep interest rates unchanged at the conclusion of its policy meeting this afternoon, but solid economic growth combined with rising inflation are likely to keep it on track for another two hikes this year even as President Donald Trump has ramped up criticism of its push to raise rates.

The Fed will announce its decision at 2PM ET and release its accompanying rate statement at the same time.

No press conference is scheduled and only minor changes are anticipated compared with the Fed’s June policy statement, which emphasized accelerating economic growth, strong business investment and rising inflation.

The U.S. central bank so far this year has increased borrowing costs in March and June, and investors see additional moves in September and December.

Besides the Fed, the economic calendar will also be busy on Wednesday, as investors get a look back at July.

ADP will release its July report on private payroll growth at 8:15AM ET. The July report on auto sales and the July reports on manufacturing activity from the Institute of Supply Management and Markit Economics also will be released.

Investors will pay particular attention to the surveys for any impact tariffs are having on the sector.

There is also weekly oil supply data from the U.S. Energy Information Administration (EIA) scheduled for this morning.

2. U.S.-China Trade War Back In Focus

Conflicting signs over the state of U.S.-China trade relations pulled markets in opposite directions. A Bloomberg report on Tuesday said that the United States and China were seeking to resume trade talks to defuse a battle over import tariffs.

However, later reports that the Trump administration plans to propose tariffs of 25%, instead of the initially proposed 10%, on $200 billion of imported Chinese goods injected uncertainty back into financial markets.

A source familiar with the plan said the announcement could come as early as Wednesday.

While the tariffs would not be imposed until after a period of public comment, raising the proposed level to 25% could escalate the trade dispute between the world’s two biggest economies.

China’s Foreign Ministry warned earlier that it will retaliate if the U.S. takes further steps hindering trade.

Investors fear an escalating trade war between the world’s two biggest economies could hit global growth and damage sentiment.

3. Apple In Touching Distance Of $1 Trillion After Earnings Beat

Apple (NASDAQ:AAPL) shares rose 3.7% in pre-market trade to $197.34, a record high, putting its market capitalization at $954 billion.

The stock would need to hit $206.49 for Apple to become the first publicly traded U.S. company to cross the $1 trillion threshold, based on Apple’s share count at the end of the quarter. Apple may have reduced its share count since then.

The tech giant reported strong results for its fiscal third quarter after the closing bell on Tuesday, with subscriptions from App Store, Apple Music and iCloud services bolstering business.

While Apple sold 41.3 million iPhones in the fiscal third quarter, half a million less than expected, the average iPhone selling price topped expectation by $30, hitting $724, according to FactSet.

The world’s most valuable technology company also forecast revenue above expectations for the fall, when it typically launches new iPhone models.

4. U.S. Stock Futures Point To Mixed Open

U.S. stock futures pointed to a mixed open, with technology shares set to get a boost as sentiment improved after results from tech bellwether Apple topped Wall Street forecasts.

At 5:30AM ET, the tech-heavy Nasdaq 100 futures indicated a gain of 12 points, or about 0.2%, at the open.

However, the blue-chip Dow futures and S&P 500 futures indicated a slightly lower start to their respective trading sessions, as fears of an imminent escalation in the tariff war between the U.S. and China weighed.

Elsewhere, the U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, was a shade higher at 94.45.

In the bond market, U.S. Treasury prices edged lower, pushing yields higher across the curve, with the benchmark 10-year yield ticking up to around 2.98%, while the Fed-sensitive 2-year note was near a two-decade high of 2.68%.

5. Tesla Earnings Highlight Another Busy Earnings Day

Tesla (NASDAQ:TSLA) results due out after the market close will be the main event on the earnings calendar, in what should be another busy day of corporate earnings.

Wall Street analysts expect the company to report an adjusted loss per share of $2.78 on revenue of $4.03 billion. As has been the case in previous reports, analysts have been squarely focused on the Model 3, as well as its cash burn and potential capital needs in the coming years.

Bloomberg, citing sources, reported earlier that the company plans to invest $5 billion building a factory in China, as the trade war with the U.S. makes establishing production in the world’s fastest-growing auto market more imperative for the electric-car pioneer.

Besides Tesla, a slew of S&P 500 companies are also set to report results on Wednesday.

Before the market open, Sprint (NYSE:S), Chesapeake Energy (NYSE:CHK), Humana (NYSE:HUM), Sodastream (NASDAQ:SODA), Molson Coors (NYSE:TAP), and AMC Entertainment (NYSE:AMC) will be the highlights.

After the close, joining Tesla, will be Square (NYSE:SQ), Wynn Resorts (NASDAQ:WYNN), US Steel X, T-Mobile (NASDAQ:TMUS), Fitbit (NYSE:FIT), Marathon Oil (NYSE:MRO), and FireEye (NASDAQ:FEYE).