US Equity Futures Flat as Trade-War Concerns Resurface

S&P futures traded just below Tuesday’s highs as overnight headers the US is initiating 25% tariffs on $16 billion of Chinese goods weighed on sentiment, said Dave Lutz, head of ETFs at Jones Trading.

Europe was bid as the DAX rose 30 points after EU autos shrugged off trade angst and tech continued its global recovery. Consumer names were a touch weaker as casino fell 20% in France, while healthcare led to downside. The FTSE rallied on sterling weakness and miners were boosted by strong export data in China, but gains were capped as Glencore fell on numbers. Financials staged a rally, but volumes were 45% lighter than the average in London.

It was a mixed bag overnight in Asia: The Nikkei fell modestly, the Hang Seng rose 40 points while Shanghai gave back half of Tuesday’s gains, losing 1.6%. The KOSPI rose modestly and the Aussie climbed 20 points.

US Treasuries were drifting flat ahead of the biggest 10Y treasury auction ever at 1pm Wednesday, and German yields traded above 40 points. The dollar rose slightly as sterling struggling to hold $1.29 on persistent Brexit worries while the euro failed to hold $1.16. The yen was bid overnight. The renminbi fixed stronger, but sold off on tariff headers while Turkey’s lira fell, but remained above Monday’s record lows.

Steel closed near five-year highs in China, ore lost small and copper shed 50 points from Tuesday’s move higher, while gold drifted flat. WTI fell to $69 despite a huge draw reported at API as China’s Xi reportedly asked state oil companies to increase output. Grains and beans were both bid early.