US pre-open: Stocks to rise as earnings roll in
US stocks looked set to gain at the open on Monday as investors braced for more earnings releases.
At 1225 BST, Dow Jones Industrial Average and S&P 500 futures were up 0.3%, while Nasdaq futures were 0.7% firmer.
Despite the positive tone, US-China trade developments were back in the stoplight following reports that White House economic advisor Larry Kudlow has accused Beijing of doing nothing to ease trade disputes ahead of a G-20 meeting in Argentina next month.
"This development has not only reduced optimism over the United States and China finding a middle ground on trade but raised prospects of the US next year boosting the tariffs on $200bn of Chinese imports from 10% to 25%," said Lukman Otunuga, research analyst at FXTM.
"With a full-blown trade war between the world’s two largest economies presenting a significant threat to global growth and stability, sentiment is poised to remain fragile."
Otunuga said the main focus in the US this week would be the first reading of third-quarter GDP out on Friday.
"US economic growth is expected to have expanded 3.3% during the third quarter of 2018, slower than the 4.2% achieved in Q2. An upside surprise on GDP growth has the potential to boost buying sentiment towards the Dollar and reinforce market expectations of higher US interest rates."
Elsewhere, Italy was in focus after Moody's downgraded the country’s credit rating on Friday to Baa3, one notch above "junk" but set the outlook to "stable.
After the EU rejected Italy's budget plan to lift the deficit to 2.4% of domestic output next year from 1.8% in 2018, the government responded on Monday by saying it will adjust its fiscal policies if it risks falling short of its deficit commitments. Italian stocks were higher on Monday, but bonds were sold off, raising yields.
In corporate news, Halliburton shares were likely to be active after the energy services company posted better-than-expected third-quarter profit and revenue.
Toy maker Hasbro was poised to drop sharply at the open after its third-quarter profit and revenue fell short of analysts' expectations.
Still to come, personal care company Kimberly-Clark is due to report earnings before the opening bell.
On the data front, the Chicago Fed national activity index for September is at 1330 BST.