Thursday August 17th

17-08-2017

Wall Street set for a weak open as political turbulence weighs

U.S. stock index futures pointed to a slightly lower open on Thursday, as political turbulence coming from the White House capped gains in global trading. Dow Jones industrial average futures fell 54 points, while S&P 500 and Nasdaq 100 futures slipped 6.5 points and 26.5 points, respectively. Tensions may appear to show signs of receding between the U.S. and North Korea, however, storm clouds seem to be brewing domestically. U.S. President Donald Trump has disbanded two corporate advisory councils in the wake of receiving backlash from his statements surrounding the white supremacist rally seen in Virginia over the past weekend. Taking to Twitter, the U.S. incumbent said that "rather than putting pressure on the businesspeople" within the Strategic & Policy Forum and the Manufacturing Council, the president has decided to dissolve both groups. This comes after several leading executives had already chosen to depart from the Manufacturing Council earlier this week, and members of the Strategic and Policy Forum agreed to end the group Wednesday. The turbulence has weighed on both U.S. futures and international markets on Thursday, with Europe stocks trading under pressure in morning trade, and Asia markets finishing mixed, after a rally in the U.S. dollar was halted due to the political turmoil. Japan's Nikkei 225 edged down 0.14 percent, or 26.65 points, to close at 19,702.63, with autos and financial stocks ending the session lower. Across the Korean strait, the Kospi advanced 0.57 percent, or 13.41 points, to end at 2,361.67, as steel stocks rose on optimism about third-quarter earnings. Hong Kong's Hang Seng Index slipped 0.30 percent by 3:09 p.m. HK/SIN as earnings reporting season continued. Mainland markets closed higher: The Shanghai Composite rose 0.68 percent, or 22.1670 points, to end at 3,268.6182 and the Shenzhen Composite added 0.579 percent, or 10.9981 points, to close at 1,909.3846. Stepping aside from politics, jobless claims and the Philadelphia Fed's Manufacturing Business Outlook Survey are both due out at 8:30 a.m. ET, followed by industrial production at 9:15 a.m. ET. On Wednesday, the minutes from the Federal Open Market Committee's July meeting revealed a split in opinion between Federal Reserve members when it comes to when to raise interest rates. One side appeared to show signs of concerns over what would happen if the central bank delayed its hiking path, while the other group warned about the low-inflation environment. On Thursday, Dallas Fed President Robert Kaplan and Minneapolis Fed President Neel Kashkari are expected to speak at two separate events. On the commodities front, oil prices were fluctuating around the flat line as glut concerns continued to weigh on sentiment. At 8:09 a.m. ET, U.S. crude hovered around $46.62 per barrel, while Brent stood around $50.16. Gold rose on Thursday after minutes from the U.S. Federal Reserve's July meeting hinted at a delay in further rate hikes, while palladium hit a fresh 16-year high. Spot gold was up 0.17 percent at $1,284.89 per ounce, after gaining nearly 1 percent the previous day. U.S. gold futures for December delivery rose 0.64 percent to $1,291.10 per ounce.