US pre-open: Stocks set for gains amid trade talk optimism
By Michele Maatouk
Date: Tuesday 11 Dec 2018
(Sharecast News) - US stocks looked set for gains on Tuesday following a late recovery in the previous session, as investors welcomed signs of progress in Sino-US trade talks.
At 1220 GMT, Dow Jones Industrial Average and S&P 500 futures were up 0.7%, while Nasdaq futures were 1% firmer.
The mood was lifted after China's commerce ministry said that Chinese Vice Premier Liu spoke to US Treasury Secretary Steven Mnuchin and US Trade Representative Robert Lighthizer on a call on Tuesday morning.
Oanda analyst Craig Erlam said: "We're now seeing daily commentary it seems about the progress of talks between the US and China but the reality is that this is going to be a process that moves at a glacial pace but the fact that talks are happening are a reason to be optimistic."
In corporate news, DSW shares surged nearly 17% in pre-market trade after well-received third-quarter results.
On the macro front, small business sentiment in the US deteriorated more than expected in November, according to the National Federation of Independent Business.
The small business optimism index fell to 104.8 last month from 107.4 in October, missing expectations for a dip to 107.0.
"Small business owners are enthusiastic about the economy and have demonstrated their optimism by raising wages, creating new jobs, and investing in their businesses throughout 2018," said NFIB President and CEO Juanita D. Duggan.
"Overall, small business owners have shown a historic trend in optimism for their businesses and the economy and continue to be the driving force behind economic growth."
Ian Shepherdson, chief economist at Pantheon Macroeconomics, said: "Capex aside, this survey looks like a softening, but this is not an interest rate-driven end-of-the-cycle rollover; it has been triggered by the drop in stock prices, which in large part reflects the trade war with China.
"If that problem is solved, as we expect, the stock market will rebound, dragging the NFIB back up."
Still to come, the producer price index for November is at 1330 GMT.
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