China was hitting back against U.S. President Donald Trump's plans to impose tariffs on $50 billion in Chinese goods with similar tariffs on U.S. goods even as Trump's top economic adviser Larry Kudlow said the administration was involved in a "negotiation" with China rather than a trade war.

While the broader U.S. equity market recovered somewhat as the day wore on industrial stocks were still down significantly by late afternoon.

Shares in U.S. aerospace giant Boeing Co were last down 2.5 percent making it one of the biggest drags on the S&P 500 though it was not immediately clear how much the tariffs would affect Boeing's newer products. The United States exported $15 billion of aircraft to China in 2016, ranking the sector equally with agricultural products like soybeans, according U.S. trade data.

"We understand some big-picture concern but it appears to us that the specific proposals from China this morning are calibrated carefully to avoid a major impact on Boeing and are therefore intended more as a message to the U.S. administration that additional trade barriers will be met with an escalating response," said JPMorgan analyst Seth Seifman.

DowDuPont Inc said its agriculture unit could be hurt by the escalating conflict as there could be "price declines in the total market" for soybeans, with negative impacts on U.S. farmers. Its shares were last down 0.6 percent.

General Motors shares reversed earlier losses and were last up 0.7 percent after the No. 1 U.S. automaker called for constructive U.S./ China dialogue, citing an "interdependence between the world's two largest automotive markets."

Agricultural machinery maker Deere & Co was down 4.5 percent. Eli Lustgarten, industrial outlook consultant at ESL Consultants, St Louis, said he was more concerned about the impact to food commodity exports, which would hurt Deere's U.S. farm customers, than farm equipment exports.

Soybean exporter Archer Daniels Midland Co and another agribusiness Bunge Ltd reversed their premarket losses and were last up more than 1 percent.

Some analysts including Mizuho's Jeremy Scott saw a silver lining for meat producers though as soybean supply could be stranded on the U.S. market. This could cut costs for U.S. meat companies. Tyson Foods shares were up 2 percent as a result.

Investors in the S&P 500's technology sector were also rattled since it has the biggest revenue exposure to China out of the benchmark's 11 major sectors. Chipmakers such as Nvidia Corp, with a 1.7 percent drop, and Intel Corp, with a 1.0 percent decline, were among the biggest percentage losers in that sector.

"These are some of the companies most exposed to potential tariffs. They would affect their business directly, immediately.” said Brad McMillan, chief investment officer of Commonwealth Financial Network in Waltham, Massachusetts.

Shares of Caterpillar, also a big exporter to China, fell 1.5 percent.

(Additional reporting by April Joyner, Scott Alwyn, Charles Mikolajczak and Lewis Krauskopf in New York, Taenaz Shakir in Bengaluru; Editing by Jeffrey Benkoe and David Gregorio)

By Sinéad Carew