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U.S. Stocks May Open Roughly Flat Amid Renewed Trade Uncertainty

wallstreet oct04 08nov19 lt

After jumping back into the markets in the previous session, traders may retreat to the sidelines once again on Friday, leading to choppy trading on Wall Street. The major index futures are currently pointing to a roughly flat open for the markets, with the Dow futures down by just 4 points.

Stocks may resume the lackluster performance seen earlier in the week amid renewed uncertainty about a potential U.S.-China trade deal.

News U.S. and Chinese negotiators had agreed to roll back existing tariffs as part of a phase one trade deal contributed to early strength on Thursday.

However, buying interest waned after a report from Reuters said the idea faces fierce internal opposition from President Donald Trump's advisers.

Multiple sources familiar with the talks told Reuters the idea of a tariff rollback was not part of the original October "handshake" deal between Trump and Chinese Vice Premier Liu He.

Citing current and former administration officials, Reuters said there is a divide within the administration over whether rolling back tariffs will give away U.S. leverage in the negotiations.

The latest reports have sparked renewed uncertainty about what type of trade deal Trump will ultimately be willing to accept.

Trump has repeatedly criticized past administrations for being too weak on China, but he would also like a big political victory ahead of next year's presidential election.

Shortly after the start of trading, the University of Michigan is scheduled to release its preliminary reading on consumer sentiment in the month of November. The consumer sentiment index is expected to inch up to 95.9 in November after rising to 95.5 in October.

The Commerce Department is also due to release its report on wholesale inventories in the month of September. Wholesale inventories are expected to dip by 0.3 percent.

After sticking to the sidelines for two consecutive sessions, traders rushed back into the markets in early trading on Thursday amid signs of progress in U.S.-China trade talks. The major averages reached new record intraday highs but gave back some ground as the day progressed.

Nonetheless, the major averages managed to remain in positive territory, with the Dow and the Nasdaq ending the day at new record closing highs.

The Dow advanced 182.24 points or 0.7 percent to 27,674.80, the Nasdaq climbed 23.89 points or 0.3 percent to 8,434.52 and the S&P 500 rose 8.40 points or 0.3 percent to 3,085.18.

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Friday. Japan's Nikkei 225 Index rose by 0.3 percent, while Hong Kong's Hang Seng Index slid by 0.7 percent.

Meanwhile, the major European markets have all moved to the downside on the day. While the U.K.'s FTSE 100 Index has fallen by 0.5 percent, the German DAX Index is down by 0.4 percent and the French CAC 40 Index is down by 0.3 percent.

In commodities trading, crude oil futures are slumping $0.84 to $56.31 a barrel after climbing $0.80 to $57.15 a barrel on Thursday. Meanwhile, after plummeting $26.70 to $1,466.40 an ounce in the previous session, gold futures are sliding $5.30 to $1,461.10 an ounce.

On the currency front, the U.S. dollar is trading at 109.34 yen versus the 109.28 yen it fetched at the close of New York trading on Thursday. Against the euro, the dollar is valued at $1.1033 compared to yesterday's $1.1050.

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