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Stocks May See Further Downside In Early Trading - U.S. Commentary

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Stocks are likely to move to the downside in early trading on Friday, extending the pullback seen over the two previous sessions. The major index futures are currently pointing to a lower open for the markets, with the Dow futures down by 103 points.

The downward momentum on Wall Street comes amid lingering concerns about a potential trade deal between the U.S. and China.

Adding to the worries, a report from the Wall Street Journal said the U.S. and China don't even have a draft accord that specifies where they agree and disagree.

The report comes after President Donald Trump told reporters he will not meet with Chinese President Xi Jinping before a crucial March deadline.

"Not yet. Maybe. Probably too soon," Trump said when asked if he would meet with Xi in the next month or so before flatly saying, "No" when asked if the two leaders would meet before the deadline.

Tariffs on Chinese goods are currently set to jump automatically on the deadline, although Trump is expected to delay the increase as talks continue.

However, White House economic adviser Larry Kudlow told Fox Business on Thursday the U.S. and China have a "pretty sizable distance to go" before reaching a trade deal.

Overall trading activity may be somewhat subdued, as a lack of major U.S. economic data could keep some traders on the sidelines.

Stocks moved notably lower over the course of the trading session on Thursday, adding to the modest losses posted in the previous session. With the drop, the major averages pulled back further off the two-month closing highs set on Tuesday.

The major averages climbed well off their worst levels of the day but still closed firmly negative. The Dow slumped 220.77 points or 0.9 percent to 25,169.53, the Nasdaq plunged 86.93 points or 1.2 percent to 7,288.35 and the S&P 500 tumbled 25.56 points or 0.9 percent to 2,706.05.

In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Friday. Japan's Nikkei 225 Index plummeted by 2 percent, while Hong Kong's Hang Seng Index slipped by 0.2 percent.

The major European markets have also moved to the downside on the day. While the U.K.'s FTSE 100 Index is just below the unchanged line, the French CAC 40 Index is down by 0.2 percent and the German DAX Index is down by 0.5 percent.

In commodities trading, crude oil futures are inching up $0.16 to $52.64 a barrel after tumbling $1.37 to $52.64 a barrel on Thursday. Meanwhile, after edging down $0.20 to $1,314.20 an ounce in the previous session, gold futures are rising $4.30 to $1,318.50 an ounce.

On the currency front, the U.S. dollar is trading at 109.86 yen compared to the 109.82 yen it fetched at the close of New York trading on Thursday. Against the euro, the dollar is valued at $1.1348 compared to yesterday's $1.1341.

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