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Uncertainty About Tax Reform May Weigh On Wall Street

The major U.S. index futures are pointing to a lower opening on Tuesday following the modestly higher close seen in the previous session.

Lingering uncertainty about the outlook for the Republican tax reform proposal may weigh on the markets as the House prepares to vote on their bill later this week.

The House bill has significant differences from the Senate version, raising concerns about whether GOP lawmakers will be able to work together to combine the legislation.

Nonetheless, traders may be reluctant to make significant moves ahead of the release of reports on consumer prices, retail sales, industrial production and housing starts in the coming days.

After seeing initial weakness, stocks moved modestly higher over the course of the trading session on Monday. The major averages climbed well off their early lows and managed to end the day in positive territory.

The Dow inched up 17.49 points or 0.1 percent to 23,439.70, the Nasdaq crept up 6.66 points or 0.1 percent to 6,757.60 and the S&P 500 edged up 2.54 points or 0.1 percent to 2,584.84.

The initial move to the downside partly reflected uncertainty about the outlook for tax reform, although selling pressure waned shortly after the start of trading.

Traders seemed reluctant to make significant moves ahead of the release of some key economic data later this week.

Reports on producer and consumer prices, retail sales, industrial production, and housing starts are likely to attract attention in the coming days.

Commodity, Currency Markets

Crude oil futures are slipping $0.25 to $56.51 a barrel after inching up $0.02 to $56.56 a barrel on Monday. Meanwhile, after climbing $4.70 to $1,278.90 an ounce in the previous session, gold futures are falling $4.80 to $1,274.10 an ounce.

On the currency front, the U.S. dollar is trading at 113.50 yen compared to the 113.62 yen it fetched at the close of New York trading on Monday. Against the euro, the dollar is valued $1.1757 compared to yesterday's $1.1667.


Asian stocks gave up early gains to end mostly lower on Tuesday as Chinese economic data disappointed and uncertainty lingered over U.S. tax policy.

China's Shanghai Composite index dropped 17.87 points or 0.5 percent to 3,429.97 after a slew of data showed the world's second-largest economy cooled further last month. Hong Kong's Hang Seng Index edged down 30.06 points or 0.1 percent to 29,152.12.

Chinese industrial production and retail sales growth decelerated in October and property investment also cooled, as measures taken to curb excessive debt and factory pollution weighed on activity, data from the National Bureau of Statistic showed.

Industrial output grew 6.2 percent year-over-year in October, down from the 6.6 percent expansion seen in September.

Retail sales growth eased to 10 percent from 10.3 percent, while fixed asset investment climbed 7.3 percent compared to 7.5 percent increase seen for the nine months ended in September. Bank lending and property investment growth figures also disappointed investors.

Japanese shares closed roughly flat, with the benchmark Nikkei 225 Index finishing marginally lower at 22,380.01. The broader Topix index dropped 4.62 points or 0.3 percent to 1,778.87.

SoftBank shares fell 1.5 percent after the tech giant said there is a possibility it may not make an investment in ride-hailing service Uber.

Australian shares fell sharply, dragged down by energy stocks after Royal Dutch Shell said it would sell 71.6 million shares in Woodside Petroleum at a 3.5 percent discount to Monday's closing price.

The benchmark S&P/ASX 200 Index shed 53.10 points or 0.9 percent to finish at 5,968.70, while the broader All Ordinaries Index ended down 48.50 points or 0.8 percent at 6,048.70.

Woodside Petroleum shares fell as much as 3.2 percent, and Origin Energy, Santos, Oil Search and Beach Energy lost 1-3 percent. Retailer Harvey Norman declined 1.3 percent and JB Hi-Fi retreated 2.6 percent ahead of Amazon's formal launch of 'marketplace' service in the country.

The country's big four banks ended down between 0.9 percent and 1.4 percent, while mining heavyweights BHP Billiton and Rio Tinto dropped around 1 percent each.

On the economic front, a weekly survey compiled by the ANZ bank and Roy Morgan Research revealed that Australian consumer confidence strengthened during the week ended November 12th to the highest level in seven weeks despite ongoing political uncertainty. Another gauge of business confidence also improved slightly in October.


European stocks have turned mixed on the day as investors look ahead to comments by a slew of central bankers this week for directional cues.

While the U.K.'s FTSE 100 Index has risen by 0.2 percent, the German DAX Index is down by 0.2 percent and the French CAC 40 Index is down by 0.4 percent.

Manz has rallied after the high-tech equipment manufacturer affirmed its FY revenue outlook after narrowing its nine-month loss.

Bilfinger shares have also jumped after the engineering services firm posted its first organic rise in output volume after three years of declines.

Chipmaker Infineon Technologies has also climbed after raising its dividend and saying it expects year-on-year revenue growth of about 9 percent, plus or minus 2 percentage points.

Meanwhile, Henkel has tumbled after the company warned of difficult conditions in the consumer goods market and said "currency effects will have an increasingly negative impact".

Technology firm Smiths Group has also shown a notable move to the downside after its first quarter underlying revenue fell 2 percent.

U.S. Economic Reports

Producer prices in the U.S. increased by more than expected in the month of October, according to a report released by the Labor Department on Tuesday.

The Labor Department said its producer price index for final demand climbed by 0.4 percent in October, matching the increase seen in September. Economists had expected prices to inch up by 0.1 percent.

Excluding food and energy prices, core producer prices also rose by 0.4 percent in October after a matching increase in the previous month. Core prices had been expected to rise by 0.2 percent.

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