US STOCKS-Futures tumble as China exec arrest threatens trade truce
(For a live blog on the U.S. stock market, click LIVE/ ortype LIVE/ in an Eikon news window)
* Futures drop: Dow 1.60 pct, S&P 1.54 pct, Nasdaq 2.04 pct
By Shreyashi Sanyal
Dec 6 (Reuters) - U.S. stock index futures fell more than1.5 percent on Thursday, as the arrest of a top executive ofChinese tech giant Huawei for extradition to the United Statessparked fears of a flare-up in Sino-U.S. tensions, while slidingoil prices added to the pressure.
The arrest of Huawei Technologies Co Ltd'sHWT.UL ChiefFinancial Officer Meng Wanzhouof in Canada triggered freshdoubts over the prospect of Washington and Beijing striking adeal in their 90-day truce period. urn:newsml:reuters.com:*:nL1N1YA1YR
Investor worries that a protracted trade war would dentglobal growth were exacerbated on Tuesday by a drop inlonger-dated U.S Treasury yields and culminated in Wall Street'sthree major indexes closing down more than 3 percent.
Adding to those concerns on Thursday was a drop in oilprices after the Organisation of the Petroleum ExportingCountries signaled it may agree to a smaller-than-expected cutin crude output. O/R
"The indices are headed for another tumble as the previoussteep sell-off extends itself on a host of negative news," PeterCardillo, chief market economist at Spartan Capital Securities,said in a client note.
"The arrest of Huawei CFO is putting in doubt the tradetruce between the U.S. and China, while the Saudis propose amillion barrels of oil output cuts with Russia still in limbo."
At 7:15 a.m. ET, Dow e-minis 1YMc1 were down 400 points,or 1.6 percent. S&P 500 e-minis ESc1 were down 41.5 points, or1.54 percent and Nasdaq 100 e-minis NQc1 were down 138.75points, or 2.04 percent.
The losses in the first few minutes of trading might havebeen even steeper, but CME Group's Chicago Mercantile Exchangeimplemented a series of 10-second trading halts that helpedlimit the initial drop. urn:newsml:reuters.com:*:nL1N1YB00F
Suppliers of Huawei, the world's second-biggest smartphonemaker and largest telecoms equipment maker, were among thebigger losers in premarket trading, with Intel CorpINTC.O dropping 2.8 percent and Qualcomm IncQCOM.O falling 1.9percent.
Shares of trade-sensitive bellwethers Caterpillar IncCAT.N and Boeing CoBA.N dropped 2.6 percent and 3.1percent, respectively, while oil majors Exxon MobilXOM.N andChevron CVX.N dropped about 1.5 percent.
The U.S. trade deficit widened to $55 billion in November,from $54 billion in October, data from the U.S. CommerceDepartment at 8:30 a.m. ET (1330 GMT) is expected to show. (Reporting by Shreyashi Sanyal in Bengaluru; additionalreporting by Marc Jones) ((Shreyashi.Sanyal@thomsonreuters.com; +1 646 223 8780 ;Reuters Messaging:Shreyashi.Sanyal.firstname.lastname@example.org))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of NASDAQ, Inc.