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Futures surge on hopes of U.S.-China trade deal

U.S. futures surged after Treasury Secretary Steve Mnuchin said US, China ‘were’ close to trade deal

U.S. futures surged on Wednesday after Treasury Secretary Steve Mnuchin said the U.S.-China trade deal is “90% complete”.

His comments boosted hopes that U.S. President Donald Trump and Chinese President Xi Jinping will avoid escalating their dispute over trade and, ultimately, global economic power when they meet on Saturday on the sidelines of the G20 summit.

Tech-heavy Nasdaq 100 futures jumped 54 points or 0.7% by 6:44 AM ET (10:44 GMT), while Dow futures was up 110 points or 0.4% and S&P 500 futures gained 13 points or 0.5%.

Wall Street slumped on Tuesday after Federal Reserve Chair Jerome Powell and St. Louis Fed President James Bullard downplayed the chances of a large rate hike in July. Powell said the central bank will be patient on its approach to rate cuts, while Bullard pointed to a smaller rate cut than the 50 basis points that some had hoped for.

Semiconductor company Micron (NASDAQ:MU) jumped 9.9% after its earnings beat expectations and it said that it was still able to export certain products to China, despite the White House ban on American companies doing business with Huawei and other companies.

FedEx (NYSE:FDX) rose 1.2% after it reported better-than-expected earnings for the fiscal fourth-quarter, while Chinese giant Alibaba (NYSE:BABA) gained 1.8% and Facebook (NASDAQ:FB) was up 1%.

AbbVie (NYSE:ABBV) bounced back 2.1% after falling 16% on Tuesday on what was seen as an expensive acquisition offer for Botox-maker Allergan (NYSE:AGN).

Tesla (NASDAQ:TSLA) inched down 0.1% after yet another executive left the company.

On the economic front, durable goods orders are out at 8:30 AM ET (12:30 GMT).

In commodities, crude oil rose 1.6% to $58.76 a barrel, on course for its fourth rise in five days after signs that the summer driving season is finally eating into U.S. crude inventories.

Gold futures slipped 0.6% to $1,410.85 a troy ounce, meanwhile, in reaction to the comments from Fed officials.

The U.S. dollar index, which measures the greenback against a basket of six major currencies, inched up 0.1% to 95.732.

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