US pre-open: Stocks to rise as investors eye data slew

14 September 2018

(Sharecast News) - US stocks looked set to rise at the open on Friday as investors awaited a slew of data releases and continued to keep an eye on trade relations between the US and china.
At 1230 BST, Dow Jones Industrial Average and S&P 500 futures were up 0.2%, while Nasdaq futures were 0.4% firmer.

Sino-US trade relations were in focus again. Investors had grown hopeful of some progress earlier in the week after Chinese officials welcomed an invitation for new talks from US Treasury Secretary Steve Mnuchin. However, a tweet from US President Trump on Thursday tempered expectations somewhat.

He said: "The Wall Street Journal has it wrong, we are under no pressure to make a deal with China, they are under pressure to make a deal with us. Our markets are surging, theirs are collapsing. We will soon be taking in Billions in Tariffs & making products at home. If we meet, we meet?"

Investors were also likely to be keeping an eye on Hurricane Florence, which was expected to land in the US East Coast shortly, with North Carolina first on the list. <em>S&amp;P</em> said in a note that the hurricane was likely to give reinsurers a jolt, but losses should be manageable.

"While no initial estimates of losses for Hurricane Florence (category 2) are available, reconstructed loss estimates based on present-day risk exposure for Category 3-4 hurricanes that have hit the region in the past per RMS vary between $8 billion-$20 billion," S&amp;P said.

In corporate news, shares of <strong>NiSource</strong> fell on news that customers of one of its regulated utilities, Columbia Gas of Massachusetts, were ordered to evacuate their homes following gas-related explosions.

Elsewhere, medical marijuana company <strong>Tilray</strong> was also sharply lower on the back of a <em>Politico</em> report that Canadians who work in the industry or invest in the sector could risk a lifetime ban on travel to the US.

On the data front, investors will eye the release of retail sales and import prices for August at 1330 BST, along with industrial production at 1415 BST and the Michigan consumer sentiment index at 1500 BST.

Chris Beauchamp, chief market analyst at<em> IG</em>, said: "US markets have returned to their winning ways this week, and even a shift towards a more hawkish view from policymaker Lael Brainard has not unduly disturbed equities. As CPI cools and wages rise, the US seems set to continue is economic outperformance, though the ongoing outflows in US equities suggests we are not at the 'irrational exuberance' phase of this rally just yet."

Meanwhile, <em>Oanda</em> analyst Craig Erlam said the retail sales data is expected to provide further evidence that the US economy has been gathering momentum, with spending expected to have risen by 0.4% last month.

"This would continue the steady trend of rising sales over the course of the year as consumers spend the additional income that tax cuts afforded them thanks to last year's reforms," he said.