US pre-open: Stocks seen weaker again amid trade war fears

US stocks looked set for mild losses at the open on Friday following a heavy selloff in the previous session, as China promised immediate retaliation to the import tariffs levied by US President Donald Trump.

At 1210 GMT, Dow Jones Industrial Average futures were down 0.2%, while S&P 500 and Nasdaq futures were down 0.1% and 0.4%, respectively. A day earlier, the Dow Jones index closed 2.9% lower, the S&P 500 dropped 2.5% and the Nasdaq 2.4% as equities experienced their biggest sell off since 8 February.

On Thursday, President Donald Trump signed off on 25% tariffs on $50bn worth of Chinese imports in a bid to punish the People's Republic for intellectual property infringements.

China, meanwhile, said it was planning to impose tariffs on $3bn worth of US products in retaliation. The list included pork, wine, fruit, nuts and stainless steel pipes. In a statement earlier on Friday the Chinese commerce ministry said: "China doesn't hope to be in a trade war, but is not afraid of engaging in one."

China was also said to have intervened in stock markets on Friday as trade war fears sparked a massive sell-off. According to Bloomberg, State-backed funds bought large-cap stocks including China Petroleum & Chemical Corp. and China Life Insurance Co. intensifying purchases in the afternoon.

Adding to the downbeat tone were worries about Trump's decision to replace national security adviser HR McMaster with war-hungry former UN ambassador John Bolton.

Craig Erlam, senior market analyst at Oanda, said: "For a person who’s been obsessed with stock market gains since his election victory 16 months ago, US President Donald Trump doesn’t appear too concerned about the impact his tariffs are having at the moment.

"Understandably, the prospect of a trade war between the world’s two largest economies is not particularly desirable for investors. The global economy is finally starting the tick along nicely after a decade of efforts to repair the damage of the global financial crisis and the issues that followed and now we’re potentially having to deal with an entirely self-inflicted and avoidable problem."

In corporate news, Pfizer was weaker in pre-market trade after GlaxoSmithKline said it’s no longer interested in the company's consumer healthcare business. This came a day after Reckitt Benckiser said the same.

Elsewhere, Nike rallied after better-than-expected third-quarter numbers.

On the data front, durable goods orders are due at 1230 GMT while new home sales are at 1400 GMT.