Futures lower on tariff woes, social media stocks in focus

September 5, 2018

By Shreyashi Sanyal

(Reuters) – U.S. stock index futures fell on Wednesday, as investors weighed the possibility of President Donald Trump following through on plans to impose a fresh round of U.S. tariffs on Chinese goods right after a public comment period ends on Thursday.

Also in focus are social media stocks Facebook <FB.O> and Twitter <TWTR.N> as their top executives face the U.S. Congress over what lawmakers see as a failure to combat continuing foreign efforts to influence U.S. politics.

Facebook <FB.O> was down 0.7 percent in premarket trading, while Twitter dropped 0.5 percent. Snapchat-parent Snap Inc <SNAP.N> was off 0.8 percent.

Meanwhile, tariff worries weighed on trade-sensitive companies, with Caterpillar <CAT.N> and Boeing <BA.N> down 0.4 percent and 0.6 percent.

Consultations on a U.S. proposal to impose tariffs on $200 billion more in Chinese imports ends on Sept. 6 with Trump ready to impose these tariffs as soon as the comment period ends, Bloomberg reported.

The United States and Canada will also resume talks to settle differences on revamping the North American Free Trade Agreement (NAFTA), despite Trump’s threats to continue trade deals with just Mexico in a bilateral agreement.

At 7:18 a.m. ET, Dow e-minis <1YMc1> were down 76 points, or 0.29 percent. S&P 500 e-minis <ESc1> were down 5.75 points, or 0.20 percent and Nasdaq 100 e-minis <NQc1> were down 17.5 points, or 0.23 percent.

Among other stocks, Nike <NKE.N> was off 0.13 percent, still suffering the effects of a social media backlash after it chose Colin Kaepernick, the first NFL player to kneel during the national anthem as a protest against racism, to participate in a new ad campaign.

General Electric <GE.N> fell 1.5 percent after brokerage UBS cut its price target on the stock on concerns over the company’s power business.

JD.com <JD.O> declined 4.5 percent, down for the second day in a row, after a public information report released by police said the Chinese retailer’s chief executive officer was arrested in Minneapolis last week following an allegation of rape. Richard Liu, who through his lawyers has denied any wrongdoing, was released from custody on Saturday without being charged or paying bail.

Data from the Commerce Department on international trade deficit for the month of July is expected at 8:30 a.m. ET.

(Reporting by Shreyashi Sanyal in Bengaluru; Editing by Shounak Dasgupta)

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September 05, 2018 at 05:10PM
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