Thursday May 3rd

3-05-2018

Dow set to fall 150 points amid US-China trade talks

U.S. stock index futures pointed to a lower open on Thursday morning, amid waning hopes of real progress in U.S.-China trade talks. At around 7:55 a.m. ET, Dow Jones industrial average futures fell 106 points, indicating a decline of 155 points. Nasdaq 100 and the S&P 500 futures also pointed to a negative start to the session for their respective markets. The moves in premarket trade come ahead of much-anticipated talks between Treasury Secretary Steven Mnuchin and Chinese Vice Premier Liu He. Shortly before the talks were set to take place in Beijing, the mood between the world's two largest economies worsened amid reports the U.S. administration is considering taking executive action to restrict some Chinese firms' ability to sell telecoms equipment. Gold futures spiked Thursday morning, trading 1 percent higher at $1,318.70 per ounce. The precious metal is often seen as a safe-haven trade. Oil dipped on Thursday, weighed down by swelling U.S. crude inventories and record weekly U.S. production that undermined efforts by OPEC to cut supplies, although potential new U.S. sanctions against Iran kept markets on the edge. Brent crude oil futures were at $73.31 per barrel at 0654 GMT, down 5 cents from their last close. U.S. West Texas Intermediate (WTI) crude futures were down just 1 cent at $67.92 per barrel. Prices were pulled down by a report from the U.S. Energy Information Administration (EIA) on Wednesday showing U.S. crude inventories jumped by 6.2 million barrels to 435.96 million barrels in the week to April 27, the highest level in 2018. On Wednesday, U.S. stocks finished lower after the Federal Reserve's latest monetary policy announcement hinted at higher inflation ahead. In economic news, initial claims for state unemployment benefits rose 2,000 to a seasonally adjusted 211,000 for the week ended April 28, the Labor Department said on Thursday. Claims dropped to 209,000 in the prior week, which was the lowest level since December 1969, while services PMI (Purchasing Managers' Index) data for April and factory orders for March are scheduled to be published during mid-morning trade. Meanwhile, in Europe, the Stoxx-600 index was around 0.3 percent lower on Thursday. In Asia, the Shanghai Composite in China ended up 0.7 percent, while the Nikkei in Japan closed down 0.16 percent. South Korea's Kospi index came under pressure, with the benchmark declining 0.73 percent to close at 2,487.25. Greater China markets turned in a mixed performance, with Hong Kong's Hang Seng Index falling 1.44 percent by 3:07 p.m.