US pre-open: Stocks seen lower after weak Chinese data
US stocks looked set for losses at the open on Friday, taking their cue from declines across the pond following the release of weak Chinese data.
At 1130 GMT, Dow Jones Industrial Average and S&P 500 futures were down 0.9%, while Nasdaq futures were 1.1% lower.
Chinese data released earlier showed that industrial production rose 5.4% on the year in November, versus expectations of 5.9% growth. Meanwhile, retail sales were up 8.1%, falling short of expectations for 8.8% growth and marking the weakest pace of growth since 2003.
Joshua Mahony, market analyst at IG, said: "Talk of China resuming purchases of US soybeans has helped provide another element of optimism after the recent trimming of tariffs on US cars.
"However, with Chinese retail sales and industrial production joined by a batch of weaker eurozone PMI surveys, it is easy to see why that’s been overshadowed."
Meanwhile, Russ Mould, investment director at AJ Bell, said: "There is some concern that the impact of the US/China trade war has yet to be properly felt, suggesting that China’s economic data could be in for more shocks in early 2019 unless the countries secure a permanent truce."
The downbeat tone in US futures came even as China confirmed that it will temporarily halt its additional 25% tariffs on US vehicles. According to a release on the Chinese finance ministry’s website, China will suspend 25% tariffs on 144 vehicles and auto parts from the US and 5% on an additional 67 auto items.
The temporary halt - which was part of an agreed truce between the US and China - will kick off on 1 January for three months.
"This is a positive development development no doubt, but while the US-China trade tensions are thawing slightly, they still remain frosty and are in danger of freezing back over all together at a moment’s notice," said XTB chief market analyst David Cheetham.
On the US data front, retail sales are at 1330 GMT, while capacity utilization and industrial production are at 1415 GMT. Markit’s manufacturing PMI is at 1445 GMT and wholesale inventories are at 1500 GMT.