Monday September 17th

17-09-2018

Wall Street set for a muted open, as US-China trade concerns rumble on

U.S. stock index futures pulled back ahead of Monday's open, as investors kept abreast of a trade spat between two major economies. Dow Jones Industrial Average futures slipped 24 points, indicating a slide of 28.67 points at the open. S&P 500 and Nasdaq 100 also pointed to a downbeat open for their respective markets. As a new week kicks into action, political concerns from recent sessions continue to rattle investor sentiment. Markets remain jittery on Monday following media reports, that President Donald Trump is looking to announce new tariffs on around $200 billion worth of Chinese imports as soon as Monday. A senior administration official familiar with the matter told CNBC Sunday that the U.S. administration was readying a fresh round of tariffs. On Monday, China's Foreign Ministry responded to speculation, stating that the government would retaliate in kind to the U.S. if it initiates fresh tariffs, Reuters reported. This comes just days after news emerged that the U.S. was seeking to reignite trade discussions with China. Trump tweeted on Monday that tariffs have "put the U.S. in a very strong bargaining position," adding: "If countries will not make fair deals with us, they will be 'Tariffed!'"  On the economic front, factories in the New York region grew at a slower but still-solid pace in September, a survey of executives showed. The Empire State manufacturing index fell to 19 points in September from 25.6 in the prior month. Economists had expected a reading of 23, according to a survey by Econoday. In earnings, FedEx and Oracle are both scheduled to publish earnings after the bell. Investors will be keeping a close eye on stocks that can be impacted by natural disasters and weather, as the now-downgraded tropical depression Florence continues to wreak havoc on states including North and South Carolina. Markets in Asia were relatively mixed, while stocks in Europe came under slight pressure. Asian markets were broadly negative on Monday, amid reports over the weekend that the U.S. could be imposing new tariffs on $200 billion of Chinese goods as early as this week. In South Korea, the Kospi recovered slightly from its earlier losses but still ended the trading day lower by 0.66 percent at 2,303.01. The Greater China markets also saw losses, with Hong Kong's Hang Seng index dropping 1.4 percent as of 3:07 p.m. Over on the mainland, the Shanghai composite closed 1.11 percent lower at 2,651.79 while the Shenzhen composite fell 1.535 percent to close at 1,380.98. Global oil prices edged up from early losses on Monday despite assurances from Washington that Saudi Arabia, Russia and the United States can raise output fast enough to offset falling supplies from Iran and elsewhere. U.S. Energy Secretary Rick Perry said in an interview with Reuters on Friday that he does not foresee any price spikes and that the countries, the world's top three oil producers, can between them raise global output in the next 18 months. Brent crude oil futures gained 59 cents to $78.68 per barrel, reversing a 0.2 percent loss earlier in the session. U.S. West Texas Intermediate (WTI) futures rose 54 cents to $69.53 a barrel after posting a drop of 20 cents earlier in the trading session. A softer dollar lifted gold on Monday after two sessions of declines, but investors prepared for more weakness as simmering U.S.-China trade tensions suggested the currency would stay supported and the world's largest economy remained robust. Spot gold was up 0.3 percent at $1,196.98 an ounce after falling 0.6 percent on Friday, when it marked its third straight weekly decline. U.S. gold futures added 0.1 percent to $1,201.60.