Tuesday May 21st

21-05-2019

Dow futures pop more than 150 points after US eases trade restrictions on Huawei, Boeing rises

U.S. stock index futures were higher Tuesday as market participants continue to monitor trade developments between the world’s two largest economies. At around 7:10 a.m. ET, Dow Jones Industrial Average futures rose 159 points, indicating a rise of 178 points at the open. Dow futures were boosted by Boeing shares, which rose 2.1% after The Wall Street Journal reported that a bird collision may have caused a 737 Max crash. Futures on the S&P 500 and Nasdaq 100 were also higher. On Monday night, the U.S. government temporarily eased some trade restrictions imposed on China’s Huawei Technologies last week. The move sought to minimize disruption for the telecom company’s customers around the world. The U.S. Commerce Department said it would allow Huawei to purchase American-made goods in order to maintain existing networks and provide software updates to existing Huawei handsets until Aug. 19. Shares of chipmakers like Micron Technology, Qualcomm and Xilinx all rose more than 2%. Nvidia and Lam Research gained 1.5% and 1.8%, respectively.  The temporary easing of trade restrictions won some respite with market participants ahead of Tuesday’s opening bell. However, an increasingly fraught atmosphere between Washington and Beijing has kept financial markets on edge, with investors abandoning any hopes of an early resolution to the protracted trade dispute. The S&P 500 and Dow are both down more than 3% in May, while the Nasdaq had lost 4.9% through Monday’s close. Among S&P 500 sectors, only real estate was up for the month. Stocks in Asia were mostly higher on Tuesday as a temporary reprieve in U.S.-China trade tensions provided a breather. Mainland Chinese shares rose on the day, with the Shanghai composite gaining 1.23% to 2,905.97 and the Shenzhen component adding 1.92% to 9,087.52. The Shenzhen composite advanced 1.771% to 1,548.68. Over in South Korea, the Kospi rose 0.27% to close at 2,061.25. Elsewhere in Asia, however, the Nikkei 225 in Japan lost 0.14% to close at 21,272.45. The Topix index also declined 0.3% to finish its trading day at 1,550.30. The Hang Seng index in Hong Kong declined around 0.5%, as of its final hour of trading. Oil prices rose on Tuesday on escalating U.S.-Iran tensions and amid expectations that producer club OPEC will continue to withhold supply this year. But gains were checked by concerns that a prolonged trade war between Washington and Beijing could lead to a global economic slowdown. Brent crude futures, the international benchmark for oil prices, were at $72.18 per barrel at 0651 GMT, up 21 cents, or 0.3 percent, from their last close. U.S. West Texas Intermediate (WTI) crude futures were up 31 cents, or 0.5 percent, at $63.41 per barrel. Gold fell on Tuesday, hovering near a more than two-week low touched in the previous session, as the dollar strengthened and improved risk appetite took the sheen off bullion ahead of the release of minutes from the U.S. Federal Reserve’s latest policy meeting. Spot gold eased by 0.1% to $1,276.01 an ounce by 1010 GMT, having slipped as low as $1,273.22 on Monday. U.S. gold futures were also down 0.1% at $1,275.50.