There is a negative bias in pre-market action, which can be seen in the futures for the major indices. The S&P futures are down nine points and are trading 0.2% below fair value. The Nasdaq 100 futures are down 35 points and the Dow Jones Industrial Average futures are down 126 points.
Presumably, market participants are feeling a little anxious about the brewing trade tensions between the U.S. and China.
That tension has been wound a little tighter today on the back of a Reuters report that China is going to ask the WTO soon for permission to levy sanctions on the U.S. for failing to comply with a WTO ruling it lost in 2016 pertaining to U.S. dumping duties on goods with an export value of less than $9.0 billion.
The issue here isn't so much the WTO path China is reportedly taking, it is the notion that taking that path will raise the ire of the Trump Administration and precipitate the implementation of tariffs on another $200 billion worth of Chinese imports.
China has said it will retaliate if the U.S. imposes the tariff and the U.S. has said it is ready to launch more tariffs if China retaliates. On a related note, the New York Times reports the U.S. is considering sanctions on senior Chinese officials due to human rights violations in connection with China's treatment of minority Muslims.
It's not a good situation.
Separately, the U.S. and EU are engaged in a new conversation pertaining to trade matters and there is no telling right now if the conversation is going to end amicably or acrimoniously in terms of trade linguistics.
When it comes to trade matters, there is just one big question mark hanging over the market. Accordingly, there is an excuse to take some profits from the recent record-setting run, which transpired despite contentious trade dealings.
The bump in interest rates is facilitating some of the profit-taking inclination, too, as is the scary report that Hurricane Florence could hit the Mid-Atlantic coastline as early as Thursday with Category 4 force.
That will inevitably slow economic activity in the affected area(s) in the short term. Millions of people have already been told to evacuate.
Like yesterday, there isn't much economic news to drive things in the early going. It would be remiss not to mention, however, that the NFIB Small Business Optimism Index hit a record-high 108.8 in August, driven partly by the favorable impact of the corporate tax cut.
There isn't much corporate news either, yet there is an M&A deal of note in the semiconductor space. Japanese firm Renesas Electronics has made an offer to acquire Integrated Device (IDTI) for approximately $6.7 billion, or $49.00 per share, in cash.
That news, though, hasn't lifted the broader market.
The futures for the major indices are down, and while that will be relevant in just a bit when the opening bell rings and the trading day gets started, it means nothing compared to today's remembrance of 9/11.