Futures edge lower as trade tensions mount

[June 21, 2018]  By Medha Singh

(Reuters) - U.S. stock index futures dipped on Thursday as the impact of an ongoing trade spat between the United States and China began to appear in company forecasts, while a media report said Beijing could target U.S. blue-chip firms.

Traders work on the floor of the New York Stock Exchange (NYSE) in New York, U.S., June 19, 2018. REUTERS/Brendan McDermid

At 7:20 a.m. ET, Dow e-minis <1YMc1> were down 64 points, or 0.26 percent. S&P 500 e-minis <ESc1> were down 3.25 points, or 0.12 percent and Nasdaq 100 e-minis <NQc1> were down 3 points, or 0.04 percent.

China could strike at members of the Dow Jones Industrial Average <.DJI> if U.S. President Donald Trump keeps exacerbating tensions over trade, state-controlled Chinese tabloid The Global Times said in a commentary.

The 30-member Dow includes Caterpillar <CAT.N> and Boeing <BA.N>, which are reliant on China for sizeable revenue, and are in the midst of a seven-session losing streak following the recent escalation in trade rhetoric.

The Dow 30 components showed no big moves in early premarket trading, with Boeing and Caterpillar slightly higher in light volumes.

A wave of worry hit the global auto industry after Germany's Daimler <DAIGn.DE> cut its 2018 profit forecast and BMW <BMWG.DE> said it was looking at "strategic options" because of the China-U.S. trade spat.

Share of Ford <F.N> fell 0.8 percent, while General Motors <GM.N> declined 2.7 percent in premarket trading.

Adding pressure was a drop in oil prices as the OPEC appeared to be nearing a deal to increase production.

The so-called FAANG stocks were higher, set to continue their record run, and could lend support to the market, as they did on Wednesday.

The five stocks – Facebook <FB.O>, Amazon <AMZN.O>, Apple <AAPL.O>, Netflix <NFLX.O> and Alphabet <GOOGL.O> – were up between 0.1 percent and 1 percent premarket.

Micron <MU.O> jumped 4.8 percent after strong demand for its memory chips drove its results and forecast above analysts' expectations.

Data at 8:30 a.m. ET is expected to show that initial claims for state unemployment benefits last week rose to 220,000 from 218,000 the week before.

(Reporting by Medha Singh in Bengaluru; Editing by Sriraj Kalluvila)

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