By Geoffrey Smith
Investing.com - U.S. stock futures were broadly lower in early morning trade in New York, with participants fretting about the future path of the Ukraine war ahead of a key phone call between the U.S. and Chinese Presidents.
Joe Biden is due to talk with Xi Jinping at 9 AM ET and, according to Secretary of State Antony Blinken, will warn him that the U.S. will retaliate against China if its - so far only verbal - support of Russia morphs into something more substantial. U.S. officials claim that Russia asked China for military aid earlier, a request that is likely to have become more urgent, given the heavy losses of equipment that it has sustained due to surprisingly fierce Ukrainian resistance.
The U.S. approved $800 million in military aid, including sophisticated drone weaponry, to Ukraine earlier this week.
Biden is also likely to warn Xi against any efforts to weaken the economic sanctions that the West has imposed on Russia since its invasion three weeks ago.
By 7:25 AM ET (1125 GMT), Dow Jones futures were down 242 points, or 0.7%, while S&P 500 futures were down 0.8% and Nasdaq 100 futures were down 0.9%. All three indices had made solid back-to-back gains over the last two days in a relief rally that followed the Federal Reserve's first interest rate hike in three years.
Chicago Fed President Charles Evans and his Richmond counterpart Tom Barkin are both likely to comment on the thinking behind that move when they speak later, as may Fed Governor Michelle Bowman. However, there is little on the data calendar after a busy week for economic news, existing home sales for February being the sole indicator of note.
Individual stocks moving in premarket trade included GameStop (NYSE:GME), which reported a surprise loss for the holiday quarter after the bell on Thursday. Analysts had expected a profit of 85 cents a share.
Also likely to be in focus is Apple (NASDAQ:AAPL) stock, after Porsche CEO Oliver Blume said it had been in talks with the company about possible projects. The news revived interest around Apple's long-awaited-but-never-confirmed foray into automobiles.
Elsewhere, the dollar pushed back towards a two-year high against the yen after the Bank of Japan warned of a possible hit to the Japanese economy from a war that could lead to higher raw material prices. BoJ Governor Haruhiko Kuroda indicated that he wasn't concerned about the weakness of the yen, however. The dollar index was up 0.4% at 98.365, advancing against the euro as well as the yen.
Crude oil prices also continued to push higher amid fears that the war could drag on and even intensify. The U.S. warned Russia against using chemical weapons, a move that some analysts see as possible, given the struggles of Russia's conventional forces. U.S. crude futures were up 1.0% at $104.04 a barrel, while Brent was up 0.9% at $107.60 a barrel.
Gold futures were down 0.3% at $1,938.30 an ounce.