Wall Street futures are subdued in advance of US-China Trade Talks
U.S. Stock Index Futures were Subdued On Monday As Investors Looked Ahead To Talks Between The United States And China Intended At Repairing A Trade Rift That Has Shackled Financial Markets For Much Of This Year.
The top officials of both countries will be meeting in London in order to resolve disagreements over a preliminary accord reached last month in Geneva, which had temporarily cooled tensions.
The meetings take place four days after U.S. president Donald Trump and Chinese President Xi Jinping had spoken by phone. This was their first direct contact since Trump's inauguration on January 20, 2017. However, the leaders left some key issues for future discussions.
In a recent note, Raffi Boysadjian said that there is a reasonable expectation that the second round this week of trade talks will result in a further thawing in relations between Washington, D.C., and Beijing.
S&P 500 benchmark closed above 6,000 for the first since February 21st, following a better than expected jobs report and a recovery in Tesla's share price.
The U.S. equity market rallied in May on the back of a combination of positive earnings data and low inflation, as well as the hope that more trade agreements would be reached between the U.S.
The S&P 500 is still a little more than 2% below the all-time record highs reached in February. Meanwhile, the Nasdaq has fallen about 3% from its December peak.
Citigroup has raised its S&P 500 year-end forecast, joining other brokerages. They cited renewed optimism about corporate earnings and the accelerating growth of artificial intelligence. The benchmark is expected to end the year at 6,300 compared with the previous forecast of 5,800.
This week, the major data releases include May consumer price readings and initial unemployment claims. Investors expect the Federal Reserve will keep rates unchanged next Monday, but they'll be looking for signs of inflation because Trump's tariffs could increase price pressures.
Traders are currently pricing in a 50% chance of a 25 bps rate cut in September. Data compiled by LSEG shows that traders expect 46 basis point cuts in rates by the end 2025.
At 07:00 am. At 07:00 a.m. ET, Dow E Minis were up 17 pts, or 0.04 %, S&P E Minis were up 3.25 pts, or 0.05 %, and Nasdaq E Minis were down 8.25 ppts, or 0.04%.
In premarket trading, most megacaps and growth stocks traded in a mixed bag. Tesla shares dropped 2.7% following a report that Baird had downgraded its stock from "outperform" to "neutral".
Robinhood Markets dropped 5.3%, after the S&P 500 left index constituents unchanged during its latest rebalancing. This was contrary to the expectations of some analysts who expected the online brokerage would join the benchmark index.
Intuitive Surgery fell by 3.2% after Deutsche Bank downgraded it to "sell" (from "hold") from the medical device manufacturer.
EchoStar's shares fell 6.4% following a report that said the firm is considering Chapter 11 bankruptcy.
Sunnova Energy shares fell 31% following the filing of Chapter 11 bankruptcy. Reporting by Kanchana Chkravarty in Bengaluru and Sukriti gupta; editing by Devika Syamnath
(source: Reuters)
