US pre-open: Stocks seen higher after Senate passes budget blueprint

Michele Maatouk WebFG News | 20 Oct, 2017 12:08 - Updated: 12:08 | | |

New York Stock Exchange, markets, traders, USA, stocks, shares, Wall Street. Photo: Pete Bellis

US futures pointed to a slightly firmer open on Wall Street on Friday after the Senate passed a budget blueprint for the next fiscal year, pushing President Trump one step closer to implementing his tax reforms.

At 1205 BST, Dow Jones Industrial Average and S&P 500 futures were up 0.4%, while Nasdaq futures were 0.2% higher.

Late on Thursday, the Senate approved the budget resolution by a 51-49, a move President Trump tweeted would be “the first step toward massive tax cuts for the American people”.

Investors are also likely to be eyeing reports that Trump favours Federal Reserve Governor Jerome Powell as the next Fed chairman. According to Politico, Powell is the leading candidate to become the chair of the US central bank after Trump concluded a series of meetings with five finalists on Thursday.

Oanda analyst Craig Erlam said: “US equity markets are on course to open higher on the final trading day of the week, having recovered strongly following a tough start on Thursday to end the day in the green.

“The buy the dip mentality is alive and well, with traders clearly not willing for markets to drop even a little before pushing them higher once again. The passing of the budget resolution through the Senate late on Thursday is likely helping lift sentiment further today, with final approval in the House being a big step towards Donald Trump’s long awaited tax reform being enacted.”

Market participants will also eye speeches by Fed President Loretta Mester and Fed chair Janet Yellen later in the day.

In corporate news, General Electric looked set for a down day after the company’s third-quarter earnings missed expectations, with profit taking a hit from restructuring costs.

Still to come, Schlumberger is due to report before the market open.

Elsewhere, PayPal Holdings was in the black after quarterly earnings and revenue on Thursday surpassed expectations, while Skechers surged in pre-market trade after an earnings beat late on Thursday.

On the data front, US existing home sales are due at 1500 BST.

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