Source: Sharecast
The cautious start also comes before the all-important US consumer price index report for April later on, which comes at a time when economists are still attempting to calculate the impact of Donald Trump’s fluctuating trade policies on inflation.
Dow futures were showing a 0.1% loss by 0717 ET, while the S&P 500 was falling 0.3% and the Nasdaq was slipping 0.4%.
The three indices jumped 2.8%, 3.3% and 4.4% respectively after the US and China temporarily agreed to lower tariffs as they work on a new trade deal. The world’s two largest economies will now cut levies for the next 90 days, with Washington reducing tariffs on Chinese goods to 30% from 145%, and Beijing lowering duties to 10% from 125%.
"With the US and China both slashing tariffs by 110%, traders can look through much of the April data should it prove worrying, with today’s US CPI providing the first opportunity to do so," said Joshua Mahony, chief market analyst at Scope Markets.
"The widely anticipated uptick in price pressures within the April monthly CPI report looked to be the first sign that we were on a pathway to another secondary surge in inflation."
The US inflation report will be the market-moving event of the day, due out at 0930 ET. According to consensus estimates, the CPI index is expected to have risen by 0.3% in April after a 0.1% decline in March, though the year-on-year rate is tipped to have held steady. The key figure for core inflation, meanwhile, is estimated to be unchanged at 2.8%.