* Dow down 0.39 pct, S&P down 0.14 pct, Nasdaq up 0.26 pct (Updates with major indexes cutting losses)
By Sinéad Carew
March 7 (Reuters) - The S&P 500 pared losses late on Wednesday after the White House said Canada and Mexico, and possibly other countries, may be exempted from planned U.S. import tariffs on steel and aluminum on the basis of national security.
At 3:29 p.m. ET, the Dow Jones Industrial Average fell 95.98 points, or 0.39 percent, to 24,788.14, the S&P 500 lost 3.9 points, or 0.14 percent, to 2,724.22 and the Nasdaq Composite added 18.15 points, or 0.25 percent, to 7,390.16.
The S&P had fallen as much as 0.97 percent earlier in the session as investors worried U.S. President Donald Trump would cause a trade war delivering on his threat to impose steep import tariffs of 25 percent for steel and 10 percent for aluminum and cause a trade war after free trade supporter Gary Cohn from his position as Trump's top economic advisor.
White House spokeswoman Sarah Sanders told a media briefing the president would sign something by the end of the week and "there are potential carve-outs for Mexico and Canada based on national security, and possibly other countries as well."
"That may be why we're paring losses if it's not a hard-and-fast 25-percent tariff. What's going to happen hasn't been defined yet. It makes investors less worried than they would be if this tariff was applied to every industry and every country," Janna Sampson, co-chief investment officer at OakBrook Investments LLC in Lisle, Illinois.
Advancing issues outnumbered declining ones on the NYSE by a 1.02-to-1 ratio; on Nasdaq, a 1.90-to-1 ratio favored advancers.
The S&P 500 posted 12 new 52-week highs and 3 new lows; the Nasdaq Composite recorded 136 new highs and 18 new lows. (Additional reporting by Sruthi Shankar in Bengaluru; Editing by Chizu Nomiyama and Nick Zieminski)