Wall Street set to open higher; healthcare bill vote awaited

It was not clear late on Thursday evening that Trump and Republican leaders had enough support to pass the bill.

By: Reuters | Bengaluru | Published:March 24, 2017 7:39 pm
US, Wall street, US stocks, US healthcare bill, healthcare bill US, Trump healthcare bill, Donald Trump healthcare legislature, Healthcare legislature US stocks, Dow, US Congress stocks, World news This July 15, 2013, file photo, shows a sign for Wall Street outside the New York Stock Exchange. (AP Photo/Mark Lennihan, File)

U.S. stocks looked set to open higher on Friday, helped by higher oil prices and ahead of a closely watched vote on a healthcare bill seen as a test of President Donald Trump’s ability to pass his legislative agenda through Congress. It was not clear late on Thursday evening that Trump and Republican leaders had enough support to pass the bill, with Trump warning lawmakers from his party that he will leave Obamacare in place if they do not rally around him.

Investors fear that a failure to pass the bill could endanger Trump’s promises of tax cuts and stimulus. On Tuesday, Wall Street recorded its worst one-day loss since before the U.S. presidential election due to these concerns. All three major indexes are now on track to post their first monthly declines since October.

“Yes, the delay is a disappointment but the bill hasn’t failed,” said Art Hogan, chief market strategist at Wunderlich Securities in New York.

“Unfortunately, we are going to get bogged down by this a little bit which does push out the timing of tax reform though we can still have the framework for the tax reform by October and still have it in 2018. I think the market is starting to digest that a little with the selloff we had on Tuesday.”

The CBOE Volatility index, Wall Street’s “fear gauge”, closed at its highest level in more than two months on Thursday.

The S&P has risen about 10 per cent since Trump’s election as U.S. president on November 8. Dow e-minis were up 46 points, or 0.22 per cent, with 22,231 contracts changing hands at 8.32 am ET (1232 GMT). S&P 500 e-minis were up 4 points, or 0.17 per cent, with 113,737 contracts traded. Nasdaq 100 e-minis were up 13 points, or 0.24 per cent, on volume of 22,115 contracts.

St Louis Fed Chief James Bullard is scheduled to make an appearance later this morning and his comments will be closely watched for clues on the future path of interest rate hikes. The U.S. central bank raised rates by 25 basis points last week.

Data on Friday showed new orders for key U.S.-made capital goods unexpectedly fell in February, but shipments surged.

The Commerce Department said non-defense capital goods orders excluding aircraft, a closely watched proxy for business spending plans, dipped 0.1 percent last month after rising 0.1 percent in January.

Shares of Micron Technology jumped 13.7 percent to USD 30.08 in premarket trading, a day after the chipmaker’s current-quarter revenue and profit forecasts beat expectations. GameStop fell 10.7 per cent to USD 21.35 after the company’s full-year profit forecast fell far below estimates.

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