Futures lower as Italy worries weigh, trade relief fades

[October 02, 2018]  By Medha Singh

(Reuters) - U.S. stock futures pointed to a lower open on Tuesday after anti-euro comments from an Italian lawmaker reignited investor worries over a euro zone breakup and relief from a reworked NAFTA deal faded.

Traders work on the floor of the New York Stock Exchange (NYSE) in New York, U.S., September 20, 2018. REUTERS/Brendan McDermid/File Photo

Italy would enjoy more favorable economic conditions outside of the euro zone, said Claudio Borghi, a eurosceptic who chairs the budget committee of the lower house of parliament.

Borghi later clarified but his comments pushed Italy's bond yields to multi-year highs, sparked a selloff in Italian banks that also pressured euro zone banks.

Big U.S. banks were trading lower premarket but in low volumes.

At 6:47 a.m. ET, Dow e-minis <1YMc1> were down 85 points, or 0.32 percent. S&P 500 e-minis <ESc1> were down 7.75 points, or 0.26 percent and Nasdaq 100 e-minis <NQc1> were down 31 points, or 0.4 percent.

The comments tempered optimism from Monday, when the Dow and the S&P 500 kicked off fourth quarter on an upbeat note after a last-minute deal to salvage NAFTA as a trilateral pact helped ease trade worries.

Among early losers were chipmakers, with Intel <INTC.O>, Micron <MU.O>, Advanced Micro Devices <AMD.O> down between 0.9 percent and 1.4 percent.

U.S. Steel Corp <X.N> fell 2.15 percent after Deutsche Bank downgraded the stock on concerns around free cash flow generation and operational inconsistencies.

U.S. auto sales numbers for September, due later in the day, will likely show an increase to 16.90 million vehicles from August's 16.72 million vehicles.

Investors will keep an eye on Federal Reserve Chairman Jerome Powell's speech on "The Outlook for Employment and Inflation" at 12:45 p.m. ET in Boston.

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

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