Thursday March 28th

28-03-2019

Stock futures little changed after GDP matches expectations

U.S. stock index futures were little changed Thursday, amid talks of progress in the contentious trade talks between the U.S. and China. Investors in the U.S. awoke to optimistic reports of progress in all areas under discussion in U.S.-China trade talks, with what Reuters called unprecedented movement on the touchy issue of forced technology transfers, U.S. officials said. At around 7:10 a.m. ET, Dow Jones Industrial Average futures indicated a gain of 20 points at the open. Futures on the S&P 500 and Nasdaq 100 also pointed to marginal gains. Wall Street's main indexes ended Wednesday's session in the red on the back of further moves in the bond market. The closely watched 10-year rate hit its lowest level since December of 2017. This comes after the same bond fell below its three-month counterpart last week — a phenomenon described as inverted yield curve. This is usually perceived as a sign that a recession could be about to erupt. Signs of a potential recession has also impact stock trades. Market participants are also likely to closely monitor a flurry of speeches from policymakers at the U.S. central bank. Philadelphia Fed President Patrick Harker, Atlanta Fed President Raphael Bostic, New York Fed President John Williams, and Fed Vice Chair for Supervision Randal Quarles are all set to comment on the world's largest economy at separate events on Thursday. Investors will also be monitoring further data releases. The U.S. economy grew by 2.2 percent in the fourth quarter, according to the government's final read released Thursday. Major Asian stock markets closed lower on Thursday following an overnight slip on Wall Street after the closely-watched 10-year Treasury yield touched its lowest in more than a year. The Nikkei 225 in Japan dropped 1.61 percent to close at 21,033.76. The Topix index also fell 1.59 percent. Mainland Chinese stocks were also lower on the day, as the Shanghai composite fell 0.92 percent to 2,994.94 and the Shenzhen component declined 0.65 percent to 9,546.51. The Shenzhen composite also shed 0.905 percent to 1,639.72. Over in Hong Kong, the Hang Seng index was about 0.2 percent higher in its final hour of trading. South Korea's Kospi shed 0.82 percent to close at 2,128.10. Oil prices fell on Thursday, extending losses into a second consecutive session following a surprise rise in U.S. crude inventories. International Brent crude oil futures were down 86 cents, or 1.3 percent, at $66.97 a barrel around 7:40 a.m. ET (1140 GMT), from their last close. U.S. West Texas Intermediate crude futures dropped 90 cents, or 1.5 percent, to $58.52 per barrel. U.S. crude inventories rose last week by 2.8 million barrels, compared with analysts' expectations for a decrease of 1.2 million barrels, the U.S. Energy Information Administration said. Demand concerns on the back of economic jitters linked to the U.S.-Chinese trade war have also capped prices. Spot gold prices on the other hand were steady at $1,309.88 per ounce, while U.S. gold futures were down 0.1 percent at $1,308.70 an ounce. Bullion touched a one-week low earlier in the session, mainly pressured by a strong dollar.