US pre-open: Stocks to slip as US-China tensions continue to weigh

US futures pointed to yet another downbeat session on Wall Street on Thursday as simmering tensions between the US and China remain firmly on investors’ minds.

At 1230 BST, Dow Jones Industrial Average futures were down 0.3%, while S&P 500 and Nasdaq futures were 0.1% lower.

Oanda analyst Craig Erlam said: "The week started with the US and China announcing tariffs against one another which will come into effect on 6 July, and it will end with the European Union announcing counter-tariffs against the world’s largest economy in response to those already imposed. While much of what has been announced this week was already anticipated, the rhetoric between these huge trading partners is heating up and that’s a major concern for investors.

"Oil prices are coming under a little pressure once again as we near the outcome of the meeting in Vienna between OPEC and some non-OPEC countries where producers are due to discuss whether and how to increase output following their success in significantly reducing global inventories. It is believed there is some dispute between members on how much to increase output by, with Iran reportedly opposed to bowing to pressure from the US."

West Texas Intermediate was down 1.5% to $64.76 a barrel while Brent crude was 1.6% lower at $73.57.

In corporate news, AT&T was set to edge higher after announcing an alliance with Brookfield Infrastructure to offer colocation and other services to customers in 18 internet data centres in the US 13 overseas. As part of the deal, AT&T will get $1.1bn which will be used to cut debt.

Elsewhere, Micron Technology was firmer in pre-market trade after posting well-received earnings late on Wednesday, but American Outdoor Brands was set for heavy losses after its quarterly report late on Wednesday.

Olive Garden parent Darden Restaurants edged up in pre-market trade after its fourth-quarter numbers, while retail giant Kroger and Barnes & Noble were likely to be active as they were also slated to report before the opening bell.

On the data front, initial jobless claims and the Philadelphia Fed manufacturing survey are at 1330 BST. In addition, Minneapolis Fed President Neel Kashkari is due to appear at the African Development Center June 2018 Commerce and Community Conversation in Minneapolis.