Wall St. set to open lower after economic data

(Reuters) – U.S. stocks were set to open lower on Thursday after disappointing economic data, while investors tracked U.S.-China trade talks amid signs that the two countries were tackling some of the stickiest issues in their trade war.

Traders work on the floor of the New York Stock Exchange (NYSE) in New York, U.S., February 13, 2019. REUTERS/Brendan McDermid

Washington and Beijing officials were drawing up six “memorandums of understanding”, sources told Reuters, adding that the two sides were pushing for an agreement by March 1.

Stocks have gained this week on hopes of a trade resolution, extending a rally since the beginning of the year, driven by an upbeat fourth-quarter earnings season and a dovish Federal Reserve.

“The market’s crept up waiting for an actual agreement (with China), anything short of that is a disappointment,” said Rick Meckler, partner at Cherry Lane Investments in New Vernon, New Jersey.

New orders for key U.S.-made capital goods unexpectedly fell in December amid declining demand for machinery and primary metals, pointing to a further slowdown in business spending on equipment that could crimp economic growth.

Another set showed the number of Americans filing applications for unemployment benefits fell last week, but the four-week moving average rose to a more than one-year high, suggesting the labor market was slowing down.

The Philadelphia Fed’s gauge on U.S. Mid-Atlantic business activity declined in February to its weakest level since May 2016.

“The numbers on Philadelphia Fed Manufacturing and durable goods are volatile indicating that the economy is slowing,” said Robert Pavlik, chief investment strategist and senior portfolio manager at SlateStone Wealth LLC in New York.

“Overall, it is showing that the economy is not as strong as it was in the summer of 2018.”

At 8:53 a.m. ET, Dow e-minis were down 33 points, or 0.13 percent. S&P 500 e-minis were down 4.75 points, or 0.17 percent and Nasdaq 100 e-minis were down 10.75 points, or 0.15 percent.

Nike shares fell 1.4 percent after emerging basketball star Zion Williamson was injured when his Nike sneaker split during a game.

Johnson & Johnson shares dropped 1.5 percent after the company said it received subpoenas from U.S. regulators related to litigation involving alleged asbestos contamination in its signature Baby Powder product line.

Bunge Ltd slipped 5.3 percent after the global grains merchant reported a lower-than-expected quarterly profit, as its agribusiness was hit by declining soybean prices in Brazil.

Reporting by Shreyashi Sanyal and Sruthi Shankar in Bengaluru

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