Futures rise as trade tensions ease

[August 27, 2018]   By Shreyashi Sanyal

(Reuters) - U.S. stock index futures rose on Monday as news that the United States and Mexico were closing in on a trade deal added to optimism about the economy, following recent reassuring comments from Federal Reserve Chairman Jerome Powell.

U.S. and Mexican trade negotiators are seen as close to reaching a common position on the North American Free Trade Agreement, with Mexican Economy Minister Ildefonso Guajardo saying on Sunday that talks have "continued to make progress". Talks will restart on Monday at 9 a.m. ET.

Also helping sentiment was Washington pressing the European Union to speed up trade negotiations launched after last month's meeting between President Donald Trump and EU Commission President Jean-Claude Juncker.

Trade-sensitive industrials stocks Caterpillar <CAT.N> and Boeing <BA.N> rose 0.9 percent and 0.5 percent, in light premarket trade.

Fed Chair Powell said on Friday that the central bank's gradual interest rate hikes were the best way to protect the economic recovery, maintain strong job growth and keep inflation under control.

That helped the S&P 500 close at a record high on Friday, confirming the benchmark index's longest bull-market run.

Traders work on the floor of the New York Stock Exchange (NYSE) in New York, U.S., August 23, 2018. REUTERS/Brendan McDermid

At 7:21 a.m. ET, Dow e-minis <1YMc1> were up 77 points, or 0.3 percent. S&P 500 e-minis <ESc1> were up 7.25 points, or 0.25 percent and Nasdaq 100 e-minis <NQc1> were up 27 points, or 0.36 percent.

Pfizer <PFE.N> rose 0.94 percent after saying its rare-heart disease drug reduced the risk of death by around 30 percent, boosting the prospects of what could be a billion-dollar-a-year drug.

Chipotle Mexican Grill <CMG.N> slipped 2 percent after Wedbush downgraded its rating on the burrito chain's shares.

Tesla Inc <TSLA.O> fell 3.1 percent, the most among Nasdaq 100 <.NDX> stocks trading premarket, after abandoning a plan to take the electric carmaker private.

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

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