US pre-open: Stocks seen touch lower ahead of more debt ceiling talks
By Michele Maatouk
Date: Tuesday 23 May 2023
(Sharecast News) - US stock futures pointed to a marginally lower open on Tuesday as investors eyed further debt ceiling talks.
At 1140 BST, Dow Jones Industrial Average and S&P 500 futures were down 0.1%, while Nasdaq futures were flat.
US President Joe Biden and Republican leader Kevin McCarthy failed to reach an agreement on the debt ceiling on Monday, but insisted that talks had been "productive". McCarthy said a deal can be done, while Biden said a default was "off the table".
Susannah Streeter, head of money and markets at Hargreaves Lansdown, said: "Debt ceiling talks are inching forward, but it's slow progress.
"If no agreement is reached, the US could default on interest it owes on its debts, sending borrowing costs soaring and sending shockwaves through the global economy. The forecast incoming mild recession would turn into a storm and the US financial credibility would be badly shaken. That's why President Biden and Kevin McCarthy, the Republican House Speaker, are saying they are confident there will be no default, but it's clear Republicans want to squeeze every drop of commitment to curtail spending out of the administration.
"With talks going to the wire, caution is set to stay front and centre on financial markets."
On the macro front, S&P Global's manufacturing and services PMIs for April are due at 1445 BST, while new home sales figures are scheduled for release at 1500 BST.
In corporate news, Lowe's was set to be in focus after its first-quarter earnings beat expectations but the home improvement retailer cut its full-year outlook.
It now expects total sales of around $87bn to $89bn, down from previous guidance of $88bn to $90bn and adjusted diluted earnings per share of $13.20 to $13.60, down from $13.60 to $14.00.
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