Dipo Olowookere
By Investors Hub
The major U.S. index futures are pointing to a lower opening on Wednesday, with stocks likely to add to the modest losses posted in the previous session.
Uncertainty may lead to some initial weakness on Wall Street, although selling pressure is likely to be subdued as traders keep an eye on President Donald Trump?s second summit with North Korean leader Kim Jong Un.
Traders may look to the Trump-Kim meeting for more concrete signs of progress toward the denuclearization of the Korean peninsula.
?Kim Jong Un and I will try very hard to work something out on Denuclearization & then making North Korea an Economic Powerhouse,? Trump said on Twitter this morning. ?I believe that China, Russia, Japan & South Korea will be very helpful!?
Stocks showed a lack of direction over the course of the trading session on Tuesday after recovering from an initial move to the downside. The major averages spent much of the day bouncing back and forth across the unchanged line.
Eventually, the major averages finished the session slightly lower. The Dow slipped 33.97 points or 0.1 percent to 26,057.98, the Nasdaq edged down 5.16 points or 0.1 percent to 7,549.30 and the S&P 500 dipped 2.21 points or 0.1 percent to 2,793.90.
The choppy trading on Wall Street came as Federal Reserve Chairman Jerome Powell delivered his semiannual monetary policy report to Congress, telling lawmakers the U.S. economy remains healthy but warning about potential headwinds.
Powell noted in prepared remarks before the Senate Banking Committee that the Fed has seen “some crosscurrents and conflicting signals” regarding current conditions and the economic outlook over the past few months.
The Fed Chief specifically pointed to volatility in the financial markets toward the end of 2018, calling financial conditions “less supportive of growth than they were earlier last year.”
Powell also cited slowing economic growth in foreign countries, particularly China and Europe, as well was uncertainty about Brexit and ongoing trade talks between the U.S. and China.
“We will carefully monitor these issues as they evolve,” Powell told the members of the Republican-controlled Senate committee.
Reflecting the uncertainty, Powell highlighted the Fed’s decision at its January meeting to adopt a “patient approach” with regard to future interest rate hikes.
“Going forward, our policy decisions will continue to be data dependent and will take into account new information as economic conditions and the outlook evolve,” he said.
Lingering uncertainty about trade talks between the U.S. and China kept some traders on the sidelines even after President Donald Trump decided to postpone an increase in tariffs on Chinese goods.
Trump and other officials have cited progress at recent meetings, although the chances the talks will result in a long-term trade agreement between the world’s two largest economies remain unclear.
Questions about the impending summit between Trump and North Korean dictator Kim Jong Un added to the trepidation on Wall Street.
On the U.S. economic front, a Commerce Department showing housing starts tumbled to their lowest level in over two years in December was offset by a Conference Board report showing a bigger than expected rebound in consumer confidence in February.
Most of the major sectors ended the day showing only modest moves, although energy stocks showed a notable move to the downside over the course of the session.
Reflecting the weakness in the energy sector, the Philadelphia Oil Service Index and the NYSE Arca Natural Gas Index slid by 1.3 percent and 1.2 percent, respectively.
The weakness among energy stocks came even though the price of crude oil for April delivery inched up $0.02 to $55.50 a barrel.
