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Indexes up: Dow 0.5%, S&P 500 0.4%, Nasdaq 0.4%

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Trump says 100% tariffs on China not sustainable

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Eli Lilly ( LLY ) falls after Trump vows weight-loss drug price

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(Updates after markets open)

By Sukriti Gupta and Twesha Dikshit

Oct 17 (Reuters) - Wall Street's main indexes inched

higher in choppy trading on Friday after U.S. President Donald

Trump confirmed his meeting with Chinese counterpart in two

weeks, while worries over credit risks at regional banks kept

investors on edge.

Bank stocks faced selling pressure earlier in the day,

extending declines from the previous session when Zions

Bancorporation disclosed losses tied to two commercial

and industrial loans and Western Alliance revealed it

had initiated a lawsuit alleging fraud by Cantor Group V, LLC.

The selloff rekindled concerns over lax lending standards in

a sector already grappling with two auto bankruptcies, more than

two years after the collapse of Silicon Valley Bank.

Most regional bank stocks, however, stabilized on Friday.

The KBW regional banks index rose 1.2%, rebounding from

Thursday's drop of 6.3%, its biggest since early April.

The broader S&P financial index edged up 0.6%.

"They were possibly oversold yesterday and we're now getting

positive earnings from these regional banks that confirm the

earnings growth that we saw with the larger global banks. I

think that is helping to buoy investor optimism," said Sam

Stovall, chief investment strategist at CFRA Research.

Truist Financial ( TFC ) shares gained 3.6% after the bank

reported higher third-quarter profit. Fifth Third Bancorp ( FITB )

rose 3%.

Zions shares rose 6.4%, while Western Alliance advanced 4%.

Robust earnings from big U.S. banks this week have set an

upbeat tone for the start of the third-quarter reporting season.

But with elevated equity valuations, investors are treading

cautiously.

At 10:14 a.m. ET, the Dow Jones Industrial Average

rose 233.15 points, or 0.51%, to 46,185.39. The S&P 500

gained 24.60 points, or 0.37%, to 6,653.67, while the Nasdaq

Composite added 80.13 points, or 0.36%, to 22,642.67.

The main U.S. indexes were on track to register weekly

gains, if current levels hold.

The CBOE volatility index, investors' fear gauge,

dropped to 23.89 points, after hitting its highest in nearly six

months at 28.99 earlier in the day.

On the trade war front, Trump said his proposed 100% tariff

on goods from China would not be sustainable and that he would

meet China President Xi Jinping in South Korea.

The S&P 500 consumer discretionary rose 0.6% with

Tesla gaining 1.8%. Tech stocks added 0.3%.

Eli Lilly ( LLY ) fell 2.6% after Trump said he would bring

down prices of weight-loss drugs.

State Street dropped 4.6% after the bank's

third-quarter net interest income missed estimates.

Declining issues outnumbered advancers by a 1.09-to-1 ratio

on the NYSE and by a 1.29-to-1 ratio on the Nasdaq.

The S&P 500 posted four new 52-week highs and two new lows,

while the Nasdaq Composite recorded 16 new highs and 73 new

lows.