U.S. stocks were set to open lower on Thursday as rising concerns over U.S. trade protectionism, this time around car imports, overshadowed optimism that the Federal Reserve may be more tolerant of rising inflation than previously expected.
The Trump administration launched a national security probe into car and truck imports on Wednesday that could lead to new tariffs, with Beijing calling the move an “abuse” of the clauses and saying it would defend its interests.
The decision added to jitters over the prospects of trade negotiations with China, reignited after Trump called for “a different structure” to any trade deal.
Shares of European and Asian automakers skidded on the tariff possibility, while U.S. automakers inched marginally higher premarket.
“The markets are adjusting now with lots of uncertainties, with China, North Korea, (and the prospect of) a trade war that could spill over to other parts of the economy and the world,” said Adam Sarhan, chief executive of 50 Park Investments in New York.
By 8:50 a.m. ET, Dow e-minis 1YMc1 were down 56 points, or 0.23 percent. S&P 500 e-minis ESc1 were down 4.5 points, or 0.16 percent and Nasdaq 100 e-minis NQc1 were down 11.5 points, or 0.17 percent.
Wall Street posted small gains on Wednesday after minutes from the Fed’s latest meeting suggested higher inflation may not result in faster interest rate hikes.
Best Buy Co (BBY.N) slipped 5.5 percent as investors focused on slowing online sales growth over the better-than-expected quarterly comparable sales.
Williams-Sonoma (WSM.N) jumped 11.3 percent after the Pottery Barn owner posted strong quarterly results and gave a healthy forecast.
Shares of Medtronic (MDT.N) rose 1.5 percent after its quarterly profit topped Wall Street estimates on higher demand for heart valves and diabetes devices.
Reporting by Medha Singh in Bengaluru; Editing by Sriraj Kalluvila