CATCo Share News (CAT)

* Trump tweets: "Trade wars are good, and easy to win"

* J.C. Penney slumps after disappointing quarter

* S&P 500 on track for losses this week

* Dow off 0.9 pct, S&P off 0.2 pct, Nasdaq up 0.3 pct(Updates to late afternoon)

By Caroline Valetkevitch

March 2 (Reuters) - The Dow and S&P 500 fell on Friday andwere on track for weekly losses as investor anxiety built over apossible global trade war following President Donald Trump'sthreat to impose import tariffs on steel and aluminum.

Europe has drawn up a list of U.S. products from bourbon toHarley Davidson motorbikes on which to apply tariffs if Trumpcarries out his plan, European Commission President Jean-ClaudeJuncker said.

U.S. Commerce Secretary Wilbur Ross played down the fears,saying "hysteria over tariffs is a lot to do over nothing."

Trump's announcement comes at a time when the markets wasalready on edge over rising U.S. interest rates and bond yields,though some investors said a lot of details still need to beworked out.

"If (it is) the case, this could get bad, but we're notthere yet," said Brad McMillan, chief investment Officer forCommonwealth Financial Network. "I'm personally not reactingjust yet ... I wouldn't bet on any" impact to earnings at thispoint.

Shares in big U.S. steel companies and manufacturers wereunder pressure on uncertainty over the effects of tariffs.

Shares in Caterpillar, a buyer of raw materials anda big exporter of construction machinery products, were down 2.6percent after falling 2.8 percent in the previous day's session.General Motors was down 1.9 percent.

The Dow Jones Industrial Average fell 219.48 points,or 0.89 percent, to 24,389.5, the S&P 500 lost 4.64points, or 0.17 percent, to 2,673.03 and the Nasdaq Compositeadded 23.09 points, or 0.32 percent, to 7,203.66.

McDonald's dropped 5.2 percent after RBC lowered itsprice target on the stock and cut its 2018 earnings estimate,citing a disappointing early sales impact from McDonald's valuemenu. The stocks was the biggest drag on the S&P and the Dow.

J.C. Penney Co Inc shares fell 5.5 percent after thedepartment store chain missed same-store sales estimates.

Advancing issues outnumbered declining ones on the NYSE by a1.05-to-1 ratio; on Nasdaq, a 2.01-to-1 ratio favored advancers.

The S&P 500 posted no new 52-week highs and 25 new lows; theNasdaq Composite recorded 50 new highs and 63 new lows.(Additional reporting by Ankur Banerjee and Sruthi Shankar andin Bengaluru; Editing by Anil D'Silva and Nick Zieminski)