US pre-open: Stocks to drop amid geopolitical tensions; Fed minutes and inflation eyed
US futures pointed to a downbeat open on Wall Street on Wednesday amid caution ahead of the latest Federal Reserve minutes and US inflation data, as geopolitical tensions weighed on sentiment.
At 1215 BST, Dow Jones Industrial Average and S&P 500 futures were down 0.9%, while Nasdaq futures were 1% weaker.
The mood was likely to be dominated by concerns about a possible US military strike in Syria, for which Trump and his administration were working hard to gain international support.
London Capital Group analyst Jasper Lawler said: "Syria has distinct risks. Military intervention in Syria that puts the US in direct confrontation with Russia can only be a bad thing for market sentiment."
Meanwhile, Rabobank strategist Jane Foley said: "If a paring back of the risk of trade wars is good news for market sentiment, this week’s warnings by Russia to the US of grave repercussions are the opposite."
This came as President Trump weighed in with one of his characteristically subtle tweets: "Russia vows to shoot down any and all missiles fired at Syria. Get ready Russia, because they will be coming, nice and new and “smart!” You shouldn’t be partners with a Gas Killing Animal who kills his people and enjoys it!"
In terms of data, the consumer price index is due out at 1330 BST, while the Fed minutes of the 20-21 March meeting are out at 1900 BST.
The CPI is expected to have picked up to 2.4% in March from 2.2% the month before on an annualised basis, while core CPI is expected to have firmed to 2.1% from 1.8%.
IG analyst Joshua Mahony said: "This evening see the FOMC release their latest minutes, with markets attempting to better ascertain exactly how many rate rises we will see under Powell in 2018. With Janet Yellen speculating that we will likely see 3-4 2018 rate rises, markets will be watching keenly to see if the improved fiscal outlook will indeed push the Fed into tightening policy at such a pace."
On the corporate front, Facebook shares were likely to be active as chief executive Mark Zuckerberg prepares for a second day of testimony before US lawmakers.
21st Century Fox was also set to be in focus after its UK offices were raided by officials from the European Commission investigating a potential abuse of its position in the broadcasting of major sports events.