Tuesday July 3rd

3-07-2018

Dow set to rise 100 points but fears of a trade war linger

U.S. stock index futures rose on Tuesday as some tech shares gained in the premarket, despite heightened fears of a bitter trade dispute between the U.S. and major economies around the world. Dow Jones Industrial Average futures gained 103 points, pointing to a gain of 101.82 points at the open. S&P 500 and Nasdaq 100 futures also gained steam and indicated a higher open. Shares of Amazon, Apple, Netflix, Alphabet and Microsoft all traded higher before the bell as tech looked to add to Monday's strong gains. The tech sector rose 1 percent in the previous session, erasing losses from earlier in the day. The moves in premarket trade come shortly before initial U.S. and Chinese tariffs are due to take effect. President Donald Trump’s administration is set to activate tariffs on Chinese goods worth around $34 billion on Friday, which is then widely expected to trigger a tit-for-tat response from Beijing. Wall Street, however, also looked ahead to Friday in anticipation of the latest jobs report, which is expected to be a strong one. Economists polled by Reuters expect the U.S. economy to have added 200,000 jobs in June. U.S. stocks finished the first trading day of the quarter slightly higher Monday. Nonetheless, the major indexes fell sharply earlier in the session as Wall Street grew even more worried about the spat between the U.S. and its key trade partners. On the data front, factory orders for May are expected to be published at around 10 a.m. ET, with light vehicle sales data for June set to follow later in the session. U.S. markets will close early on Tuesday ahead of the Fourth of July holiday. Asian stocks stumbled on Tuesday, with China markets bouncing back after recording sharp losses earlier in the session as other major regional markets closed mixed. Meanwhile, investor worries over Beijing's trade relations with the U.S. continued to weigh on sentiment in the region. Mainland China markets rebounded in the afternoon after declining during the morning session. The Shanghai composite added 0.39 percent to close at 2,786.35 after touching two-year lows in the last session and the Shenzhen composite gained 0.76 percent. Hong Kong's Hang Seng Index declined 1.44 percent by 3:20 p.m. Elsewhere, Japan's Nikkei 225 closed lower by 0.12 percent, or 26.39 points, at 21,785.54, extending Monday's steep losses but finishing the session above its intraday low. In South Korea, the Kospi finished above the flat line, advancing 0.05 percent to 2,272.76. Oil prices rose on Tuesday after Libya declared force majeure on some of its crude exports, while the loss of Canadian supplies helped lifted U.S. crude to levels not seen since late 2014. U.S. light crude jumped $1.14, or 1.5 percent, to $75.08 a barrel, breaking above $75 a barrel for the first time since November 2014. Benchmark Brent crude oil was up $1.07, or 1.4 percent, at $78.37 by 9:07 a.m. ET (1307 GMT). Gold prices recovered from a nearly seven-month low on Tuesday as dollar eased and Asian shares sank amid heightening trade friction between the United States and major economies. Spot gold was up 0.3 percent at $1,244.72 an ounce, as of 0843 GMT. Earlier in the session, bullion prices dropped to $1,237.32, their lowest since Dec. 12, 2017. U.S. gold futures rose 0.3 percent to $1,245.80 an ounce.