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US pre-open: Futures point to positive open following tech sell-off in previous session

By Iain Gilbert

Date: Tuesday 21 May 2019

US pre-open: Futures point to positive open following tech sell-off in previous session

(Sharecast News) - Wall Street futures were pointing to a positive open on Tuesday as a mild semblance of calm looked set to return to markets following Monday's tech sell-off.
As of 1210 BST, Dow Jones futures were pointing to a gain of 0.54% at the bell, while S&P 500 and Nasdaq futures had the indices set to open 0.65% and 1.00% firmer, respectively.

The Dow looked set to open 138 points higher after the White House decided to temporarily ease the trade restrictions imposed on Chinese telecommunications giant Huawei Technologies late last week.

The Commerce Department will allow Huawei to purchase American-made goods in order to maintain existing networks and provide software updates to existing Huawei handsets until 19 August as part of an effort to minimise disruption for its users across the globe.

Despite the reprieve, Huawei chief executive Ren Zhengfei took aim at Washington on Tuesday, stating Donald Trump had underestimated just how powerful the company would be in the 5G space and revealed the firm had been stockpiling chips, leaving it well prepared for the blacklisting.

Discussing the logic behind the US's 90-day grace period, SpreadEx analyst Connor Campbell said: "The reason behind this is likely some trademark lack of forethought from the Trump administration, the government failing to anticipate the effect the blacklisting would have on the US side of things.

"However, it also is a bit of fire control for the bridge currently burning between the two nations, keeping the relationship alive ahead of next month's G20 meeting in Japan."

Elsewhere, almost 200 American footwear companies, including Nike and Under Armour, wrote a letter to the President, imploring him to cancel proposed tariffs on imported shoes from China. The shoemakers said the tariffs would be "catastrophic" for consumers, corporations and the economy alike.

In corporate news, Home Depot shares were slightly lower ahead of the bell as the hardware retailer beat first-quarter earnings expectations but fell short on same-store sales and JC Penney shares slid 13% in pre-market trade after its first-quarter sales fell short of consensus estimates.

Quarterly figures from the likes of Cracker Barrel, Kohl's and Urban Outfitters were still to come.

On the data front, the Philadelphia Fed's non-manufacturing survey will be posted at 1330 BST, followed by existing home sales figures for April at 1500 BST.

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