Futures drop on trade tensions ahead of long weekend

[August 31, 2018]   By Shreyashi Sanyal

(Reuters) - U.S. stock index futures fell on Friday, ahead of the long holiday weekend, with investors wary after President Donald Trump's latest salvo in Washington's trade war with China.

Wall Street snapped a four-day winning streak on Thursday after Bloomberg reported Trump was ready to impose tariffs on $200 billion more of Chinese goods next week, sooner than many expected, when a public comment period on the plan ends.

The U.S.-China dispute has overshadowed what has been intense, but constructive trade negotiations between the United States and Canada, although a deal is yet to be struck.

"The threat of global growth taking a hit from a damaging U.S-China relationship remains 'front and center'," said Dean Popplewell, vice president of market analysis at Oanda.

Traders also cautioned markets could be susceptible to bigger-than-usual gyrations as trading volumes are expected to be light ahead of the long Labor day holiday weekend.

At 7:31 a.m. ET, Dow e-minis <1YMc1> were down 52 points, or 0.20 percent. S&P 500 e-minis <ESc1> were down 5.25 points, or 0.18 percent and Nasdaq 100 e-minis <NQc1> were down 7.75 points, or 0.10 percent.

Shares of Coca-Cola <KO.N> rose 0.8 percent in premarket trading after the company said it would buy coffee chain Costa for $5.1 billion. Starbucks <SBUX.O> fell 2.3 percent.

A trader works at the New York Stock Exchange (NYSE) in Manhattan, New York, U.S., August 27, 2018. REUTERS/Andrew Kelly

Lululemon <LULU.O> was up 10.4 percent after the Canadian athletic apparel maker posted a second-quarter profit that beat estimates on strong online sales, particularly in China.

Apple <AAPL.O> gained 0.3 percent. Warren Buffett said Berkshire Hathaway <BRKa.N> had added to its stake in the iPhone maker and Apple announced a Sept. 12 event, at which it is expected to unveil new iPhone models.

Amazon.com <AMZN.O> was up 0.2 percent, topping $2,000 for the second day in a row to renew its push to join Apple in the $1 trillion market cap club.

Integrated Device Technology <IDTI.O> jumped 15 percent after Japanese automotive chipmaker Renesas Electronics <6723.T> said it was considering buying the U.S. chipmaker.

The University of Michigan's consumer sentiment index for August is expected at 10 a.m. ET.

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

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