Tuesday February 19th

19-02-2019

Stocks set for a weak open amid US-China trade talks

U.S. stock futures fell on Tuesday as traders waited for new details to emerge from the latest round of U.S.-China trade talks. As of 7:05 a.m. ET, Dow Jones Industrial Average futures indicated a drop of 51 points at the open. S&P 500 and Nasdaq 100 futures were barely changed. Markets are set to open Tuesday after the long Presidents Day weekend. Market players focused their attention on trade negotiations between Washington and Beijing. The White House said Monday that a new session of discussions will take place Tuesday, with higher level talks due later in the week. Tensions between the two nations have heightened as they attempt to strike a deal to prevent any further escalation in tariffs. The Chinese government said Monday that the U.S. is inhibiting its industrial development by claiming its mobile gear could pose a cybersecurity threat to countries rolling out 5G. Washington has been putting particular pressure on Huawei, the Chinese telecommunications giant, and is attempting to extradite Chief Financial Officer Meng Wanzhou over charges she committed bank and wire fraud to violate Iran sanctions. The company's founder Ren Zhengfei — who is also Meng's father — labelled the move "politically motivated" in an interview with the BBC Monday. On the earnings front, Walmart reported better-than-expected quarterly results, sending the retailer's stock up more than 3 percent in the premarket. Elsewhere, traders will be on the lookout for the National Association of Home Builders housing market index on Tuesday, and are anticipating minutes from the Federal Reserve's latest policy meeting and other economic data later in the week. Stocks in Asia were mixed on Tuesday amid renewed geopolitical tensions, with China accusing the U.S. of fueling cybersecurity fears. Mainland Chinese markets were mostly unchanged, with the Shanghai composite rising slightly to close at 2,755.65 while the Shenzhen component saw fractional losses to finish the day at 8,440.87. The Shenzhen composite rose 0.184 percent to close at 1,443.60. Hong Kong's Hang Seng index slipped 0.28 percent in its final hour of trading. Japan's Nikkei 225 rose 0.1 percent to close at 21,302.65 and the Topix was 0.28 percent higher to finish its trading day at 1,606.52. South Korea's Kospi declined 0.24 percent to close at 2,205.63. Oil stayed within sight of its 2019 high of almost $67 a barrel on Tuesday, supported by OPEC-led supply cuts although concern about slowing economic growth that would curb demand weighed. The supply curbs led by the Organization of the Petroleum Exporting Countries have helped crude prices to rise more than 20 percent this year. U.S. sanctions against OPEC members Iran and Venezuela have also tightened the market. Brent crude slipped 31 cents to $66.19 a barrel, not far from the 2019 high of $66.83 reached on Monday. U.S. crude was up 38 cents at $55.97. Spot gold rose 0.43 percent to $1,331.36 per ounce, having earlier hit $1,330.07, its highest since April 25. U.S. gold futures rose 0.96 percent to $1,334.80. The dollar was a shade weaker and backed away from a two-month high hit last week.