US pre-open: Stocks set for more losses as government shutdown looms

US stocks looked set for more losses at the open on Friday amid worries about a possible government shutdown.

At 1215 GMT, Dow Jones Industrial Average and S&P 500 futures were down 0.3% and 0.4%, respectively, while Nasdaq futures were 0.5% lower.

Sino-US relations were in focus again after the US Justice Department filed charges overnight accusing two members of a Chinese cyber-espionage group of hacking into dozens of US tech and industry giants.

It has been alleged that the two individuals were operating in conjunction with the Chinese government, although this has been denied by Beijing.

Meanwhile, rising odds of a US government shutdown were also set to weigh on the mood, as President Trump and congressional Democrats remained at odds over $5bn funding for his border wall with Mexico. Trump has said he won't sign the short-term funding bill to avoid a government shutdown because it didn't include any funds for his wall.

Oanda analyst Craig Erlam said: "Another week draws to a close in the markets and as we approach the end of the year, it’s looking increasingly unlikely that a late Santa surge is going to save what has been an otherwise horrible quarter.

"Record highs to correction territory and flirting with a bear market - those that aren’t already there that is - it really has been an extraordinary quarter that’s got investors very concerned about the year ahead. The list of headwinds has been growing throughout the year and sentiment finally caved under the pressure of it all, with Powell’s comments early October being the straw that broke the camel’s back.

"We’ve gone from undeterred optimism to widespread pessimism in such a short period of time – as is often the case - and there clearly isn’t much appetite just yet to try and catch this particular falling knife. The Trump administration’s continued hard-line approach with China isn’t helping matters and the prospect of a government shutdown isn’t doing the situation much good either."

In corporate news, Nike surged 8% in pre-market trade after releasing better-than-expected second-quarter earnings overnight and upping its guidance.

On the data front, third-quarter gross domestic product is at 1330 GMT, along with durable goods orders and PCE, while the Michigan consumer sentiment index is at 1500 GMT.