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Stocks May Move Lower Amid Concerns About Irma, North Korea - U.S. Commentary

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Following the lackluster performance seen in the previous session, stocks may move to the downside in early trading on Friday. The major index futures are currently pointing to a lower open for the markets, with the Dow futures down by 64 points.

Concerns about the economic impact of Hurricane Irma may weigh on the markets, with the category 4 storm expected to make landfall in Florida early Sunday.

FEMA Administrator Brock Long warned Irma continues to be a threat that is going to devastate the U.S. in either Florida or some of the southeastern states.

The approach of Irma comes close on the heels of Hurricane Harvey, which led to widespread devastation and flooding in Texas.

Selling pressure may also be generated due to worries about North Korea, which is celebrating a holiday on Saturday that could be a key date for another intercontinental ballistic missile launch.

Adding to investor anxiety, a major earthquake struck Mexico's southern coast early this morning that is said to be the most powerful to hit the country in a century.

Shortly after the start of trading, the Commerce Department is scheduled to release its report on wholesale inventories in the month of July. Wholesale inventories are expected to rise by 0.4 percent.

The Federal Reserve is also due to release its report on consumer credit in the month of July later in the day. Economists expect consumer credit to increase by $15.1 billion.

Among individual stocks, shares of American Outdoor Brands (AOBC) are moving sharply lower in pre-market trading after the firearm maker reported weaker than expected first quarter results and lowered its full-year forecast.

Fiber optic company Finisar (FNSR) may also come under pressure after reporting first quarter earnings that matched estimates but providing disappointing guidance.

On the other hand, specialty clothing retailer Zumiez (ZUMZ) is likely to see early strength after reporting a narrower than expected second quarter loss on better than expected revenues.

After ending the previous session moderately higher, stocks showed a lack of direction throughout the trading day on Thursday. The major averages spent the day bouncing back and forth across the unchanged line.

The major averages eventually ended the day roughly flat. While the Nasdaq inched up 4.55 points or 0.1 percent to 6,397.87, the Dow dipped 22.86 points or 0.1 percent to 21,784.78 and the S&P 500 edged down 0.44 points or less than a tenth of a percent to 2,465.10.

In overseas trading, stock markets across the Asia-Pacific region turned in another mixed performance during trading on Friday. Japan's Nikkei 225 Index slid by 0.6 percent, while Hong Kong's Hang Seng Index climbed by 0.5 percent.

The major European markets have also turned mixed on the day. While the German DAX Index has inched up by 0.1 percent, the French CAC 40 Index is down by 0.2 percent and the U.K.'s FTSE 100 Index is down by 0.4 percent.

In commodities trading, crude oil futures are edging down $0.07 to $49.02 a barrel after slipping $0.07 to $49.09 a barrel on Thursday. Meanwhile, after jumping $11.30 to $1,350.30 an ounce in the previous session, gold futures are climbing $5.70 to $1,356 an ounce.

On the currency front, the U.S. dollar is trading at 107.60 yen compared to the 108.45 yen it fetched at the close of New York trading on Thursday. Against the euro, the dollar is valued at $1.2054 compared to yesterday's $1.2023.

by RTT Staff Writer

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