Stocks - US Futures Lower; Consolidating Ahead of Trump Speech

By Peter Nurse   

Investing.com - U.S. stocks are set to open lower Friday, consolidating ahead of a key statement from President Donald Trump about his administration’s response to China strengthening its grip on Hong Kong.

At 07:00 AM ET (1100 GMT), S&P 500 Futures traded 8 points, or 0.3%, lower, Nasdaq Futures down 19 points, or 0.2%. The Dow Futures contract fell 102 points, or 0.4%. 

Despite this expected weak start to trading Friday, all three cash indices are set to post their second straight positive month. The Dow Jones Industrial Average is on track for its best weekly gain in seven weeks.

U.S. President Donald Trump will hold a news conference later Friday detailing his administration’s response after China's parliament Thursday pressed ahead with national security legislation for Hong Kong.

American relations with Beijing have been on edge since the Covid-19 pandemic reared its head, and a possible response could see Washington withdrawing Hong Kong’s special status, which has underpinned the city as a global financial hub.

Elsewhere, Twitter (NYSE:TWTR), and the other social media giants, will be in focus after it hid one of President Trump’s tweets behind a warning that it “glorifies violence”, further escalating the social media company’s row with the U.S. president.

It came just hours after he signed an executive order threatening Silicon Valley social media firms with new regulations over free speech.

Those looking for a broader look on the economy will get to hear from the head of the Federal Reserve, Jerome Powell, at 11 AM ET (15:00 GMT) in a public webcast.

Attention of late has been on the possibility of negative interest rates, which Powell has largely dismissed, but he may now face questions on the likely restart of large-scale bond-buying and promises about how long it might continue.

Additionally, data on personal income and spending are due at 8:30 AM ET (12:30 GMT). Economists predict that personal income in April fell 6.5% and that spending plunged 12.6% - both would be record declines.

At 10 AM ET, the University of Michigan will issue its final measure of May consumer confidence, and the sentiment index is expected to tick up to 74.

The crude oil market sold off Friday, after the Energy Information Administration data detailed a surprise add of 7.9 million barrels to inventories, backing up Wednesday’s report by the American Petroleum Institute, and reviving doubts about output discipline by suppliers.

At 7 AM ET, U.S. crude futures traded 3.4% lower at $32.59 a barrel. The international benchmark Brent contract fell 2.8% to $35.01.

Elsewhere, gold futures rose 0.7% to $1,726.10/oz, while EUR/USD traded at 1.1130, up 0.5%.