US pre-open: Stocks to trade slightly higher, dollar expected to drop

US futures pointed to a slightly higher open on Wall Street following the publication of strong economic data in the previous session, although the dollar is expected to weaken due to concerns about the Trump administration.

At 1041 BST, Dow Jones Industrial futures were up 0.33% to 20,728.49, S&P 500 futures rose 0.29% to 2,368.06 and Nasdaq added 0.28% to 5,914.34.

Meanwhile, West Texas Intermediate was flat at $50.36 per barrel and Brent crude fell 0.11% to $52.90.

Investors will eye possible announcements from the White House as President Donald Trump is rumoured to be studying ways to penalise currency manipulators.

Konstantinos Anthis, a researcher at ADS Securities, said: “The US president believes that rival nations that compete with the US on the manufacturing and exporting arenas are intentionally devaluing their domestic currencies in an attempt to sell their products abroad at a cheaper price. President Trump’s comments are an attempt to boost other currencies' value against the dollar, however the buck took the news in its stride as stronger GDP figures helped extend its rally higher”.

On Thursday, economists upgraded up their final revision of fourth quarter gross domestic product growth to 2.21%, while initial jobless figures published remained low.

Analysts at Monex Europe said that despite this week’s modest rally in places, the dollar is on track for its biggest quarterly drop in a year on Friday, as the last three months have seen dollar-long ‘Trumpflation’ trades repeatedly called into question, most recently on the failure of last week’s healthcare legislation.

Meanwhile, speeches from Federal Reserve presidents Robert Kaplan and William Dudley on Thursday “seemed consistent with two to three more rate hikes this year”.

The dollar was flat against the pound at 0.8022, and unchanged against the yen at 11.96, while it fell 0.12% versus the euro to 0.9357.

In corporate news, AstraZeneca’s US listed shares could be in focus after the Food and Drug Administration approved its lung cancer drug Tagrisso.

AT&T could also be in focus after the telecoms giant said it will spend about $40bn over 25 years to build and maintain a national broadband network for the police, firefighters and emergency medical services.

At 1330 BST personal consumption and spending data will be published, as well as the core PCE price index.