Few potential triggers for momentum seen
U.S. stock futures signaled a struggle Thursday for major indexes to recover from the prior day's hefty losses, as continued political turmoil stoked fears President Donald Trump's pro-growth agenda will not go ahead.
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Nasdaq-100 futures rose 11.5 points, or 0.2%, to 5,590.50, with S&P 500 futures up 3.75 points, or 0.16%, to 2,361.25. Dow industrial futures rose 9 points to 20,615.
The Nasdaq Composite led a disastrous session for Wall Street on Wednesday (http://www.marketwatch.com/story/us-stock-futures-slide-as-concerns-over-trump-grow-2017-05-17), tumbling 2.6% to 6,011.24 for its worst one-day decline since last summer's Brexit vote. The S&P 500 index fell 1.8% to 2,357.03, and the Dow industrials 1.8% to 20,606.93, both suffering their worst sessions since Sept. 9.
The heavy selloff came after The New York Times reported that U.S. President Donald Trump had asked former Federal Bureau of Investigations Director James Comey to drop an investigation between his inner circle and the Russians (http://www.marketwatch.com/story/trump-asked-comey-to-drop-flynn-investigation-report-2017-05-16).
The report sparked talk of potential impeachment for Trump, though many believe the situation is far from reaching that point (http://www.marketwatch.com/story/heres-how-impeachment-works---and-why-trump-is-safe-for-now-2017-05-17). (http://www.marketwatch.com/story/heres-how-impeachment-works---and-why-trump-is-safe-for-now-2017-05-17) In the latest development, former FBI head Robert Muller has now been named as special counsel (http://www.marketwatch.com/story/robert-mueller-ex-fbi-director-named-special-counsel-for-russia-probe-2017-05-17)to investigate potential collusion between the Trump campaign and Russia.
As stock futures struggled, analysts expressed skepticism that appetite for riskier assets would easily recharge. Charalambos Pissouros, senior analyst at IronFX, expects investors will not see much relief over the next few days.
"We base our view on the elevated market skepticism over Trump's ability to push his tax plans through Congress, as well as the fact that there is nothing major on the U.S. economic calendar to distract investors from these political developments until the release of the FOMC [Federal Open Market Committee] minutes next Wednesday," said Pissouros, in a note to clients.
On Thursday, a report on weekly jobless claims is due at 8:30 a.m. Eastern Time, with a small rise to 240,000 expected. The Philly Fed index for May is set for release at the same time, with a reading on leading indicators for April following at 10 a.m. Eastern.
Global stocks fell Thursday in the wake of the U.S. selloff. The Nikkei 225 index slid 1.3% alongside a sharp rise in the Japanese yen, which has seen sharp gains as investors seek out perceived haven assets. The dollar recovered some ground against the yen Thursday, rising to Yen111.23, from Yen111.35 in late trading Wednesday.
European stocks continued to come under pressure. The Stoxx Europe 600 index down 0.5% early Thursday, after logging a 1.2% decline Wednesday for its biggest one-day percentage loss since Sept. 26.
(END) Dow Jones Newswires
May 18, 2017 04:18 ET (08:18 GMT)