Here are the top five things you need to know in financial markets on Tuesday, November 27:
1. Trump Raises Stakes in U.S.-China Trade Conflict
Market sentiment took a hit after U.S. President Donald Trump said he expected to move ahead with raising tariffs on $200 billion in Chinese imports to 25% from the current 10%.
In an interview with the Wall Street Journal, Trump said it was “highly unlikely” he would accept China’s request to hold off on the increase, which is due to take effect on January 1.
Trump added that if negotiations between the two countries were unsuccessful, he would also put tariffs on the rest of Chinese imports.
The president’s comments come ahead of a meeting between Trump and his Chinese counterpart Xi Jinping at the G20 summit in Argentina at the end of the week.
Tensions between the two countries have dominated economic headlines this year, with both sides imposing tit-for-tat tariffs on each other’s products.
2. U.S. Futures Point to Lower Open
U.S. stock futures pointed to a lower open, as a fresh threat from Washington to impose tariffs on more Chinese imports seemed to quash hopes of a trade truce between the world’s two biggest economies.
At 5:35AM ET (1035GMT), the blue-chip Dow futures were down 25 points, or about 0.1%, the S&P 500 futures dipped 4 points, or around 0.2%, while the tech-heavy Nasdaq 100 futures indicated a loss of 25 points, or roughly 0.4%.
The moves in pre-market come after Wall Street finished Monday’s session sharply higher, with the Dow closing up more than 350 points up.
Read more: 2 Dividend Growth Stocks To Build Wealth And Protect Your Portfolio: Haris Anwar
Elsewhere, European stocks hovered around the flatline in mid-morning trade, swinging between small gains and losses, as investors continued to digest developments surrounding Brexit and Italy’s budget crisis.
Earlier, stocks in Asia closed mixed.
3. Fed Speakers to Grab Attention
A number of Fed speeches will get the market’s attention.
Fed Vice Chair Richard Clarida will speak about data dependence and monetary policy at The Clearing House and Bank Policy Institute’s Annual Conference, in New York. His comments are due at 8:30AM ET (1330GMT).
At 2:30PM ET (1930GMT), three more Fed members are scheduled to participate in a panel discussion at the same event. Chicago Fed President Charles Evans, Kansas City Fed President Esther George and Atlanta Fed President Raphael Bostic will discuss a range of topics, including the economy, regulation, financial innovation, and the future of payments.
Their comments will be useful for investors who have been scaling back their expectations for future rate hikes following recent remarks from a number of Fed officials that were interpreted as dovish.
On the data front, investors will get a key piece of economic sentiment data when The Conference Board releases its November update on consumer confidence at 10:00AM ET (1500GMT). The consensus forecast is for a reading of 135.9, down from 137.9 in October.
The latest report on home prices from S&P/Case-Shiller is also due out in the morning.
The U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, was marked modestly higher at 97.08, after hitting an overnight peak of 97.18, its best level since November 15.
In the bond market, U.S. Treasury prices edged higher, pushing yields lower across the curve, with the benchmark 10-year yield slipping to 3.06%.
4. Oil Prices Tick Higher Ahead of API Report
In commodities, oil prices ticked higher ahead of the release of fresh weekly data on U.S. commercial crude inventories.
The American Petroleum Institute is due to release its weekly report for the week ended November 23 at 4:30PM ET (2130GMT), amid expectations of a drop of about 0.6 million barrels. If confirmed, it would be the first decline in ten weeks.
U.S. West Texas Intermediate crude futures were up 24 cents, or around 0.5% at $51.87 a barrel.
Meanwhile, international Brent crude oil futures rose 43 cents, or 0.7%, to $60.99 per barrel.
The contract briefly dipped below $60 in overnight trade, pulled down by record Saudi Arabian production even as OPEC’s top producer pushes for supply cuts ahead of the group’s meeting in Austria next week.
5. Bitcoin Slides as Crypto Selloff Resumes
Bitcoin resumed its downwards trend, sliding back towards the lowest level in more than a year, as major digital currencies crashed to fresh lows.
The world’s most valuable digital currency, was down around 6% at $3,813.50. It fell to its weakest level since Sept. 25, 2017 at $3,663.00 on Sunday.
Meanwhile, XRP, the world’s second largest cryptocurrency by market cap, was trading at $0.35512, down roughly 8% for the day
Ethereum, the third largest coin, sank almost 10% to $105.83, the lowest since May 2017.